The US private sector recorded an unexpected drop in employment last month, losing 33,000 jobs in June, according to figures released on Wednesday by payroll services provider ADP — a sign that the labour market may be softening under economic uncertainty and trade tensions.
The data also showed a downward revision for May’s job growth, which now stands at 29,000.
“While widespread layoffs remain rare, we are seeing employers hesitate to hire or replace departing staff, and that resulted in job losses in June,” said ADP’s chief economist Nela Richardson. Despite this, she noted that wage growth has not yet been impacted.
Job losses were most notable in sectors such as professional and business services, as well as education and health. However, some areas, including manufacturing and leisure and hospitality, saw moderate employment gains, the report noted.
In terms of pay, annual wage growth for employees who stayed in their roles remained steady at 4.4 percent. For those switching jobs, average annual increases slowed slightly to 6.8 percent in June.
The figures come ahead of the US government’s official jobs report due later this week and are likely to fuel concerns about the health of the world’s largest economy.
“This is the first time in recent months we’ve seen the job market take a step backwards,” said Adam Sarhan of 50 Park Investments. “That’s concerning because, up until now, we’ve had low unemployment and consistently strong job creation.”
