Private payrolls grew by 122,000 in May, stronger than expected, ADP reports

Private hiring expanded at a brisk pace in May, providing further indication of a stable labor market, ADP reported Wednesday.

The payrolls processing firm said companies added 122,000 workers for the month, up from 105,000 in April and better than the Dow Jones consensus estimate for 110,000. May marked the strongest month since January 2025. April's total was revised down by 4,000.

Unlike prior months, where job growth was concentrated in healthcare and a few other sectors, gains were more broad-based. Eight of the 10 sectors ADP tracks saw gains, and hiring was spread evenly both by company size and geography.

Education and health services again led with 57,000 hires, but trade, transportation and utilities added 36,000, professional and business services contributed 11,000, and construction and leisure and hospitality both rose by 8,000.

Information services lost 9,000, a possible impact from artificial intelligence growth, while natural resources and mining also reported a loss, down 3,000.

"Hiring was more broad-based in May than we've seen in the last few years," said ADP's chief economist, Nela Richardson. "The labor market continues to show sustained momentum going into the summer hiring season."

Companies with fewer than 50 employees led with 67,000 new hires while those with 500 or more added 40,000 and medium-sized firms contributed 17,000.

On salary, annual pay rose 4.4% for those staying in their jobs, the same as April, while job-switchers saw pay growth edge down to 6.5%.