ADP reports private companies added 44,000 jobs in July, missing expectations

Private companies added just 44,000 jobs in July, according to a report by payroll processing firm ADP released on Wednesday. This figure is significantly lower than the revised 95,000 jobs added in June and falls short of the Dow Jones forecast of 75,000. Most of the job growth occurred in the services sector, which contributed 47,000 new positions, while the goods-producing sector experienced a decline of 3,000 jobs.

The report highlights a continuing trend in the job market, particularly in the education and health services sector, which alone accounted for 36,000 new jobs. Other sectors that saw gains include financial activities with 10,000 jobs, professional and business services adding 9,000, and other services contributing 6,000. In contrast, the trade, transportation, and utilities sector lost 8,000 jobs, while natural resources and mining saw a decline of 6,000. Manufacturing and construction added minimal jobs, with increases of just 2,000 and 1,000, respectively.

Wage growth remains steady, with pay for workers staying in their positions increasing by 4.4% annually. However, those who switched jobs saw a higher increase of 7%, the biggest jump since August 2025. ADP's chief economist, Nela Richardson, noted that this rapid pay growth among job changers indicates supply constraints in certain areas of the labor market. Furthermore, she highlighted that hiring patterns are shifting as employers adapt to changing economic conditions.

This report comes just two days before the Bureau of Labor Statistics will release its official nonfarm payrolls data. Economists are predicting a total of 83,000 jobs added, an increase from June's 57,000, with the unemployment rate expected to remain at 4.2%. The ADP report may influence Federal Reserve policymakers, who are currently focused on inflation as they consider future interest rate adjustments.