© Reuters.
Investing.com — U.S. private payrolls growth unexpectedly slowed in November, in a sign that the Federal Reserve’s aggressive campaign of interest rate hikes could be impacting labor demand.
Private employers in the U.S. added 103,000 jobs last month, down from a revised mark of 106,000 in October, according to payroll processor ADP. Economists had forecast an increase of 130,000 jobs.
Both the goods and services sectors saw weakness, with the manufacturing and leisure and hospitality industries posting declines.
“Restaurants and hotels were the biggest job creators during the post-pandemic recovery,” said Nela Richardson, Chief Economist at ADP. “But that boost is behind us, and the return to trend in leisure and hospitality suggests the economy as a whole will see more moderate hiring and wage growth in 2024.”
Fed policymakers will likely be keeping a close eye on the slowdown in private hiring, which serves as a warm-up act to the headline economic data this week: the all-important non-farm payrolls report on Friday.
Tempering labor demand has been one of the main pillars of the U.S. central bank’s unprecedented decision to lift interest rates to more than two-decade highs. Officials are hoping that a softening jobs picture may defuse some upward pressure on inflation.
On Tuesday, Labor Department data showed that job openings dipped to their lowest mark in over two years in October. The numbers suggested that there may be some easing in labor demand, a trend that could bolster the case for the Fed to possibly begin backing away from its tightening cycle.
Upgrade your investing with our groundbreaking, AI-powered InvestingPro+ stock picks. Use coupon code PROPLUSBIYEARLY to get a limited time discount on our Bi-Yearly Pro+ subscription plans. Click here to find out more, and don’t forget to use the discount code when checking out!
Source: Investing.com
