Private Sector Job Losses Hit 33,000 in June – Professional And Health Services Take The Biggest Hit

The U.S. private sector lost 33,000 jobs in June, according to ADP’s latest National Employment Report, signaling ongoing labor market softness even as wage growth remains steady.

The jobs report showed annual pay up 4.4% from a year ago, slightly below the 4.5% pace seen in May. Pay growth for job changers also eased to 6.8% from 7%.

U.S. equities shed early gains after the data was released. The SPDR S&P 500 ETF (SPY) edged 0.17% lower in pre-market trade while the SPDR Dow Jones Industrial Average ETF (DIA) traded 0.01% lower. The Invesco QQQ Trust Series 1 (QQQ), which tracks the tech-heavy Nasdaq 100, suffered the largest decline, down nearly 0.4%. 

However, retail sentiment on Stocktwits around SPY and DIA remained in 'bullish' territory, while retail sentiment around QQQ actually improved to 'neutral' territory from 'bearish' a day ago. 

“Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,” said ADP Chief Economist Nela Richardson. “Still, the slowdown in hiring has yet to disrupt pay growth.”

The sharpest job cuts were concentrated in the service sector. Professional and business services saw a decline of 56,000 roles, while education and health services lost 52,000 roles. 

In contrast, goods-producing industries, such as manufacturing and mining, added 32,000 jobs, helping to offset the net decline.

Across regions, the Midwest and West shed 24,000 and 20,000 jobs, respectively, while the Northeast lost 3,000. The South was the only region with net gains, adding 13,000 positions.

The data also showed that while big companies continued to hire, smaller ones were shedding their workforce. Businesses with more than 500 employees added 30,000 jobs, whereas the smallest firms – those with fewer than 20 workers – cut 29,000 jobs on net.

The government’s nonfarm payrolls report and weekly jobless claims data are both due Thursday. 

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read also: Shell Flags EY Breach, Says It Will Amend Financial Filings In US, UK