Private payrolls rose 90,000 in September, topping expectations, ADP says

• Education and health services led job creation with 55,000 new hires, while financial activities (-16,000) and professional services (-11,000) reported losses
• Year-over-year gross pay accelerated 4.7% while base pay rose 3.2%, indicating solid wage growth alongside employment gains
• The report precedes Friday's official BLS nonfarm payrolls data, which is expected to show 84,000 jobs added with unemployment holding at 4.1%

Summary

Key Figures:

Private sector employment increased by 90,000 jobs in September, exceeding the 68,000 consensus estimate and rebounding from August's downwardly revised 36,000 additions, according to ADP's Wednesday report.

Sector Performance:

Education and health services led job creation with 55,000 new positions, followed by leisure and hospitality (22,000), manufacturing (17,000), and construction (15,000). However, financial activities (-16,000), professional and business services (-11,000), and natural resources and mining (-1,000) experienced losses.

Service providers added 59,000 positions while goods producers contributed 31,000, showing balanced growth across the economy.

Wage Growth:

Base pay increased 3.2% year-over-year, while gross pay accelerated 4.7%, indicating solid compensation trends.

Geographic and Company Size Breakdown:

The Northeast region dominated growth with 56,000 new jobs. Mid-sized companies (50-499 workers) accounted for 54,000 additions.

Market Implications:

ADP Chief Economist Nela Richardson characterized the report as "strong," noting the rebound after a three-month slowdown. The data supports Federal Reserve officials' assessment that the labor market remains sound following 2025's growth concerns. However, policymakers view persistent inflation as the primary risk, prompting a quarter-point rate increase earlier in September.

Looking Ahead:

The report precedes Friday's Bureau of Labor Statistics nonfarm payrolls release, with economists expecting 84,000 jobs added (down from 162,000 previously) and unemployment holding steady at 4.1%. The ADP figures suggest potential upside to these estimates.