Hiring in the US private sector experienced a decline last month, according to a report released by a leading payroll processor provider. The report revealed that private sector employment saw an increase of 122,000 jobs in July, marking a notable slowdown compared to the previous month's growth of 155,000 positions.
This figure fell short of economists' expectations, who had anticipated a net job increase of 150,000 for the month. The data suggests a shift in the US job market from a period of robust growth to a more balanced state, resulting in a moderation of historically strong wage gains.
The report highlighted that annual pay gains for individuals remaining in their current jobs slowed to 4.8%, the lowest rate observed in three years. Additionally, wage growth for those changing jobs decreased to 7.2% from 7.7%, also hitting a three-year low.
Given the slowdown in wage growth and the easing of inflation, the Federal Reserve is closely monitoring the labor market for any signs of a potential weakening. The Chief Economist of the payroll processor provider emphasized that the labor market's current dynamics align with the Federal Reserve's efforts to manage inflation.
While the data from the payroll processor provider may not always align perfectly with the official monthly jobs report, which is scheduled for release on Friday, it is often considered a reliable indicator of overall hiring trends.
