A man left a home depot store in Midtown Manhattan on February 26, 2025 in New York City.
Eduardo Munoz Alvarez | Corbis News | Getty Images
Payroll processing company ADP reported on Wednesday that private sector job creation slowed to a crawl in February, raising concerns about the slowdown.
The company added just 77,000 new workers this month, with 186,000 upward revisions in January, down from 148,000 Dow Jones consensus estimates, according to ADP seasonally adjusted data.
Total number is the smallest growth since July, when fears economic growth is slowing and beer brewing President Donald Trump’s tariff plan It will trigger another round of inflation. ADP said annual salary increased by 4.7% in February each year, the same as last month.
“Political uncertainty and a slowdown in consumer spending could lead to a slowdown in layoffs or employment last month,” said Nela Richardson, chief economist at ADP. “Our data, coupled with other latest metrics, suggests the hesitation among employers when evaluating the economic climate ahead.”
While most economic data points remain positive, sentiment indicators suggest that among business executives and consumers, Trump tariffs may raise prices and slow fears of growth. In extreme cases, the combination May lead to trapsIt is a condition for flat or negative growth and price increases.
The ADP report reflects some of these issues as the department combines trade, transportation and utility work together, losing 33,000 positions. Education and Health Services Reports reported a drop of 28,000, while information services fell by 14,000 amidst the uncertainty of AI-related companies, despite Trump’s commitment to advance AI efforts.
On the positive side, the leisure and hospitality business increased by 41,000, while professional and commercial services increased by 27,000, and financial activities and construction reached 25,000. The manufacturing industry also reported a 18,000 increase in opposition to the ISM manufacturing survey that month, which shows that the company is retreating.
The balances of service and goods production this month were unusual, with an increase of 36,000 and 42,000 in the month respectively. Since the United States is a service-based economy, this aspect usually dominates job creation.
In February, employment growth tilted towards large enterprises, with companies hiring 500 or more workers reporting a revenue of 37,000, while workers with less than 50 employees lost 12,000.
The ADP count is a pioneer of the Labor Bureau’s Labor Statistics Bureau on non-agricultural payroll, expiring Friday. However, the two reports may vary greatly due to different methods. In January, the BLS reported that the private payroll increased by only 111,000, much lower than the ADP count.
Economists surveyed by Dow Jones expect Friday’s report will show 170,000 job gains and a steady unemployment rate of 4%.
