Latest news with #NelaRichardson
Yahoo
3 days ago
- Business
- Yahoo
The labor market's latest puzzling sign gives the Fed more leeway to wait
The US labor market is cooling. The president keeps clamoring for the Federal Reserve to cut interest rates. But Wall Street still doesn't think it's happening anytime soon. Currently, markets are not pricing in more than a 50% chance of a Fed rate cut until the central bank's September meeting, per the CME FedWatch Tool. By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy One reason why appeared in two different data releases over the past week: Wage growth remains particularly resilient. The May jobs report showed average hourly earnings rose 0.4% over the last month and 3.9% over the prior year, higher than the 0.2% monthly wage growth seen in April. Meanwhile, data from ADP showed wages for workers in the private sector who changed jobs grew 7%, while wages for those who stayed in the same job grew 4.5%. Both were unchanged from the month prior. As our Chart of the Week shows, in the past six months, wage growth for job stayers has fallen just 0.2 percentage points while pay gains for job changers have actually increased by the same amount. The gap has widened — and stayed that way. So when the president took to social media to say the smallest private payroll gain in over a year was a reason "Powell must now LOWER THE RATE," ADP chief economist Nela Richardson pointed to wages. "The labor market isn't collapsing," Richardson said. "Wages are robust, but they're not triggering inflation. Hiring is slow, but it's not leading to outside layoffs. So in that sense, there's nothing in the labor market that points in any direction [for the Fed] strongly." Such is the "totality" of the data. In a note titled 'May-day? More like Pay-day!" Bank of America US economist Shruti Mishra remarked that solid wage income growth is 'supportive of consumption but will also likely keep the Fed in their inflation fighting stance.' The chart also reveals a key piece about the state of the US economy and consumer. The great resignation may be over, but leaving a job is still providing workers with pay bumps. And those who stay are still seeing wages growing above the 2.3% headline inflation increase seen in April. This doesn't help those who are struggling to find work. And as we highlighted last week, there are plenty of displaced workers right now, particularly recent college graduates. But the fact is, the statement from Fed Chair Jerome Powell in January that it's "all good" if you have a job remains true. That's a key piece of why recession risks have fallen amid the tariff rollback of the past month and the stock market has soared back within striking distance of all-time highs. "As long as wages are robust, layoffs are low, and consumers can keep spending, I think that even if the economy slows for a period of time, it is resilient enough to rebound," Richardson said. Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer. Click here for in-depth analysis of the latest stock market news and events moving stock prices Sign in to access your portfolio
Yahoo
3 days ago
- Business
- Yahoo
The labor market's latest puzzling sign gives the Fed more leeway to wait
The US labor market is cooling. The president keeps clamoring for the Federal Reserve to cut interest rates. But Wall Street still doesn't think it's happening anytime soon. Currently, markets are not pricing in more than a 50% chance of a Fed rate cut until the central bank's September meeting, per the CME FedWatch Tool. By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy One reason why appeared in two different data releases over the past week: Wage growth remains particularly resilient. The May jobs report showed average hourly earnings rose 0.4% over the last month and 3.9% over the prior year, higher than the 0.2% monthly wage growth seen in April. Meanwhile, data from ADP showed wages for workers in the private sector who changed jobs grew 7%, while wages for those who stayed in the same job grew 4.5%. Both were unchanged from the month prior. As our Chart of the Week shows, in the past six months, wage growth for job stayers has fallen just 0.2 percentage points while pay gains for job changers have actually increased by the same amount. The gap has widened — and stayed that way. So when the president took to social media to say the smallest private payroll gain in over a year was a reason "Powell must now LOWER THE RATE," ADP chief economist Nela Richardson pointed to wages. "The labor market isn't collapsing," Richardson said. "Wages are robust, but they're not triggering inflation. Hiring is slow, but it's not leading to outside layoffs. So in that sense, there's nothing in the labor market that points in any direction [for the Fed] strongly." Such is the "totality" of the data. In a note titled 'May-day? More like Pay-day!" Bank of America US economist Shruti Mishra remarked that solid wage income growth is 'supportive of consumption but will also likely keep the Fed in their inflation fighting stance.' The chart also reveals a key piece about the state of the US economy and consumer. The great resignation may be over, but leaving a job is still providing workers with pay bumps. And those who stay are still seeing wages growing above the 2.3% headline inflation increase seen in April. This doesn't help those who are struggling to find work. And as we highlighted last week, there are plenty of displaced workers right now, particularly recent college graduates. But the fact is, the statement from Fed Chair Jerome Powell in January that it's "all good" if you have a job remains true. That's a key piece of why recession risks have fallen amid the tariff rollback of the past month and the stock market has soared back within striking distance of all-time highs. "As long as wages are robust, layoffs are low, and consumers can keep spending, I think that even if the economy slows for a period of time, it is resilient enough to rebound," Richardson said. Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer. Click here for in-depth analysis of the latest stock market news and events moving stock prices
Yahoo
6 days ago
- Business
- Yahoo
ADP Weak 2nd Straight Month: +37K, but Wages Stable
Wednesday, June 4, 2025The big report out before the opening bell this morning continues 'Jobs Week' to start a new month: private-sector payrolls from Automatic Data Processing ADP for the month of May. It came out weak for the second straight month: +37K new private-sector jobs created, only a third of the +110K projected. This followed the downwardly revised +60K ADP headline the previous is the lowest tally of new private-sector jobs since the -53K reported back in March 2023, but also looks to be settling at a lower level than would recover the amount of new retirees in the labor market. The past four months now average only +82K new jobs filled, compared to a +197K average over the previous four months — less than jobs posted a negative -2K, which is not surprising when we note the 'shedding of jobs in the goods sector,' as quoted by ADP Chief Economist Nela Richardson on CNBC this morning. Services brought in a still-paltry +36K per month. Non-farm payroll estimates for Friday's U.S. Employment Report are still up at + & Hospitality came out with +38K private-sector job gains, followed by Financial Services at +20K and Construction at +6K. But we also saw a negative -13K from the normally reliable Education & Health Services, and -27K in Professional/Business Services, such as enterprise consulting. Trade/Transportation/Utilities lost -4K private-sector jobs in companies (between 50-499 employees) led the way with gains of +49K last month, but large firms dropped -3K jobs in the private sector and small businesses slid -13K. Back to Richardson: '[Companies with] sub-250 employees make up 70% of overall U.S. employment.' So the fall in small-sized company hiring, at least in this ADP report, has added weight to the overall labor unique print within this data compares employees who stay on at their current jobs ('Job Stayers') with those who leave for other employment ('Job Changers'). Stayers in May stood to make +4.5% more year over year, where Changers reached +7.0%. While lower than levels we saw back in the Great Reopening, these are still at generally healthy Richardson concludes that today's job market, based on private-sector ADP, is 'not collapsing [but] hesitant.' She noted that 'wages are stabilizing at a pretty robust level.' On the other hand, 'There are no super-heroes in this market,' meaning there are no reliable industries to pull private-sector hiring to strong levels, the way Leisure & Hospitality did after the Covid pandemic. But 'layoffs are not imminent,' she indexes slipped from politely in the green ahead of the ADP report to into the red directly after. Currently, the Dow is -44 points, the S&P 500 is -4 and the Nasdaq -20. The small-cap Russell 2000 is down -2 points at this hour. Indexes are slightly negative over the past five trading days, but all up single-digits in the past month. Year to date, the Dow is -0.7% and the S&P is +0.7%. The Nasdaq is +2.2% but the Russell is -6.5%.More economic figures await us after the bell today, with S&P final Services PMI for May are expected to remain at +52.3, and ISM Services anticipated to tick up half a point from the initial print to +52.1%. Also, a new Fed Beige Book comes out early this afternoon, which will track economic progress among each of the Fed's 12 or comments about this article and/or author? Click here>> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report Invesco QQQ (QQQ): ETF Research Reports SPDR S&P 500 ETF (SPY): ETF Research Reports SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
Miami Herald
6 days ago
- Business
- Miami Herald
ADP: Private payrolls grew by 37,000 in May; lowest rate since 2023
Private payroll processor ADP reported Wednesday that May private sector job growth was at its lowest level in two years. U.S. private employers added 37,000 jobs in May, the lowest pace of hiring since March 2023, ADP's monthly report said. 'After a strong start to the year, hiring is losing momentum,' ADP Chief Economist Nela Richardson said in a statement. 'Pay growth, however, was little changed in May, holding at robust levels for both job-stayers and job-changers.' The Dow Jones consensus expectation was 110,000. ADP May data showed 38,000 jobs created in leisure and hospitality, 20,000 created in financial services and 8,000 in information. But professional and business services lost 17,000, education and health services lost 13,000, and natural resources and mining saw a 5,000 decline in jobs. Goods-producing industries lost a net 2,000 jobs with manufacturing down by 3,000. President Donald Trump referenced the ADP report as he again called on Federal Reserve Chair Jerome Powell to lower interest rates. 'ADP NUMBER OUT!!! 'Too Late' Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES!' Trump wrote on Truth Social. While the labor market weakened in May, pay gains held steady. ADP found that year-over-year pay increased in May by 4.5% for workers who stayed in their jobs. Pay rose 7% for job-changers. Financial services jobs had the greatest impact on pay gain of 5.2% for job-stayers. By region, the West gained 37,000 jobs and the Midwest gained 20,000. The Northeast lost 19,000 jobs and the South lost 5,000. Medium-sized employers with 50 to 499 employees added a net 49,000 jobs. But small and large employers lost 13,000 and 3,000 jobs, respectively. Copyright 2025 UPI News Corporation. All Rights Reserved.
UPI
6 days ago
- Business
- UPI
ADP: Private payrolls grew by 37,000 in May; lowest rate since 2023
ADP reported that private payrolls in March grew by 37,000, the slowest pace since 2023. File Photo by Tasos Katopodis/UPI | License Photo June 4 (UPI) -- Private payroll processor ADP reported Wednesday that May private sector job growth was at its lowest level in two years. U.S. private employers added 37,000 jobs in May, the lowest pace of hiring since March 2023, ADP's monthly report said. "After a strong start to the year, hiring is losing momentum," ADP Chief Economist Nela Richardson said in a statement. "Pay growth, however, was little changed in May, holding at robust levels for both job-stayers and job-changers." The Dow Jones consensus expectation was 110,000. ADP May data showed 38,000 jobs created in leisure and hospitality, 20,000 created in financial services and 8,000 in information. But professional and business services lost 17,000, education and health services lost 13,000, and natural resources and mining saw a 5,000 decline in jobs. Goods-producing industries lost a net 2,000 jobs with manufacturing down by 3,000. President Donald Trump referenced the ADP report as he again called on Federal Reserve Chair Jerome Powell to lower interest rates. "ADP NUMBER OUT!!! 'Too Late' Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES!" Trump wrote on Truth Social. While the labor market weakened in May, pay gains held steady. ADP found that year-over-year pay increased in May by 4.5% for workers who stayed in their jobs. Pay rose 7% for job-changers. Financial services jobs had the greatest impact on pay gain of 5.2% for job-stayers. By region, the West gained 37,000 jobs and the Midwest gained 20,000. The Northeast lost 19,000 jobs and the South lost 5,000. Medium-sized employers with 50 to 499 employees added a net 49,000 jobs. But small and large employers lost 13,000 and 3,000 jobs respectively.
