Private sector employment grew by 155,000 jobs in March as annual pay increased an average of 4.6% year to year, payroll provider ADP
Service-providing businesses added 132,000 of those jobs, including 57,000 in the professional and business services sector, which includes accounting and tax preparation. Financial activities, which includes banking, added 38,000 jobs in March. The goods-producing sector added 24,000 jobs, including 21,000 in manufacturing. However, construction hiring slowed, and the natural resources and trade, transportation and utilities sectors lost jobs.
Small businesses gained 52,000 jobs, including 42,000 in businesses with between one and 19 employees, and 10,000 at companies with between 20 and 49 employees. Medium-size establishments added 43,000 jobs, including 34,000 at businesses with between 50 and 249 employees, and 9,000 at organizations with between 250 and 499 employees. Large companies with 500 or more employees gained 59,000 employees in March.
Year-over-year pay gains slowed to 4.6% for employees who stayed in their jobs and to 6.5% for those who changed jobs. For professional and business services, the average yearly pay gain was 4.4% for job stayers. The pay premium for job-changers was 1.9 percentage points, matching a series low last seen in September.
"What that means is that there's less and less incentive for workers to quit their jobs and start new ones," said ADP chief economist Nela Richardson during a conference call Wednesday with reporters. "That pay premium shrinking to less than 2% means that the gains from switching have narrowed as well. We expect it quickly to either stabilize or even trend down over the next month or so."
