Private sector hiring slowed in April as employers added only 62,000 jobs and annual pay grew 4.5% year over year, payroll processor ADP reported Wednesday, as worries grew over tariffs and a possible recession.
That was in contrast to the
Small businesses with between one and 19 employees added 20,000 jobs, but businesses with between 20 and 49 employees lost 9,000 jobs. Medium-sized establishments added 40,000 jobs, including 21,000 in companies with between 50 and 249 employees, and 19,000 in businesses with 250 to 499 employees. Large establishments with 500 employees or more added only 12,000 jobs.
That represents "a real pullback in hiring, reflecting some of that uncertainty and unease in terms of where the economy is going," said ADP chief economist Nela Richardson during a conference call Wednesday with reporters.
"All of this does reflect some unease, and we're seeing that different sectors are responding to uncertainty at different times, some last month and this month," she added. "We expect that kind of rolling response will continue as sectors are really laser focused on what's going on in their industry, as well as trying to reconcile that with the overall macro economy."
Those concerns were highlighted by a decline in the gross domestic product number reported Wednesday by the Commerce Department, showing GDP fell 0.3% in the first quarter, the first decline since 2022.
Pay for employees who stayed in their jobs rose 4.5% in April from a year earlier, a slight deceleration from March. Year-over-year pay gains for people who changed jobs accelerated, rising from 6.7% in March to 6.9% in April. In professional and business services, the rate was 4.3% for job stayers.
Accounting Today asked whether former federal government employees who had been laid off were being hired in that sector, such as by accounting firms.
"In professional and business services, we actually saw a drop in hiring, down 2,000, so that suggests that this is not a sector that is really picking up those federal workers," Richardson replied. "There probably won't be a big swelling of workers from the federal side into the labor market in terms of looking for jobs until later in the fall, because a lot of them are still employed and receiving payment through the fiscal year. So we don't expect to see those numbers quite this soon. We'll probably see some trickling in from the federal side, but we're not seeing anything in the private sector that looks like it's a big hiring surge. There have been some shortages on the accounting side, so that is a sector that's looking to hire to make up some of those longer, more persistent shortages."
