ADP National Employment Report: Private Sector Employment Increased by 106,000 Jobs in January; Annual Pay Up 7.3%

By Jessel Renolayan First Posted: Feb 05, 2023 07:24 PM EST

Private sector employment increased by 106,000 jobs in January and annual pay was up 7.3 percent year-over-year, according to the January ADP^® National Employment Report^TM produced by the ADP Research Institute^® in collaboration with the Stanford Digital Economy Lab ("Stanford Lab").

(Photo : ADP)

The jobs report and pay insights use ADP's fine-grained anonymized and aggregated payroll data of over 25 million U.S. employees to provide a representative picture of the labor market. The report details the current month's total private employment change, and weekly job data from the previous month. ADP's pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

"In January, we saw the impact of weather-related disruptions on employment during our reference week," said Nela Richardson, chief economist, ADP. "Hiring was stronger during other weeks of the month, in line with the strength we saw late last year."

January 2023 Report Highlights*

View the ADP National Employment Report and interactive charts at www.adpemploymentreport.com.

JOBS REPORT

Private employers added 106,000 jobs in January
Employment was soft during our January 12 reference week as the U.S. was hit with extreme weather. California was coping with record floods and back-to-back storms delivered ice and snow to the central and eastern U.S.

Change in U.S. Private Employment: 106,000

Change by Industry Sector

- Goods-producing: -3,000

Natural resources/mining -2,000
Construction -24,000
Manufacturing 23,000

- Service-providing: 109,000

Trade/transportation/utilities -41,000
Information 5,000
Financial activities 30,000
Professional/business services 8,000
Education/health services 12,000
Leisure/hospitality 95,000
Other services 0

Change by U.S. Regions

- Northeast: 42,000

New England 11,000
Middle Atlantic 31,000

- Midwest: -40,000

East North Central -41,000
West North Central 1,000

- South: 55,000

South Atlantic 36,000
East South Central 28,000
West South Central -9,000

- West: 27,000

Mountain 31,000
Pacific -4,000

Change by Establishment Size

- Small establishments: -75,000

1-19 employees -70,000
20-49 employees -5,000

- Medium establishments: 64,000

50-249 employees 99,000
250-499 employees -35,000

- Large establishments: 128,000

500+ employees 128,000

PAY INSIGHTS

Pay growth was flat in January
Pay growth for job stayers held at 7.3 percent for the second month, with most industries little changed. One outlier was the information sector, where pay growth decelerated from 7 percent to 6.6 percent. For job changers, pay growth accelerated to 15.4 percent.

Median Change in Annual Pay (ADP matched person sample)

- Job-Stayers 7.3%

- Job-Changers 15.4%

Median Change in Annual Pay for Job-Stayers by Industry Sector

- Goods-producing:

Natural resources/mining 7.9%
Construction 7.1%
Manufacturing 7.2%

- Service-providing:

Trade/transportation/utilities 7.5%
Information 6.6%
Financial activities 7.4%
Professional/business services 6.7%
Education/health services 7.2%
Leisure/hospitality 10.1%
Other services 6.8%

Median Change in Annual Pay for Job-Stayers by Firm Size

- Small firms:

1-19 employees 5.5%
20-49 employees 7.0%

- Medium firms:

50-249 employees 7.6%
250-499 employees 7.6%

- Large firms:

500+ employees 7.7%

To see Pay Insights by U.S. State, Gender, and Age for Job-Stayers, visit here:

* Sum of components may not equal total, due to rounding.

The December total of jobs added was revised from 235,000 to 253,000. The historical data file, and weekly data for the previous month, is available at https://adpemploymentreport.com/.

January's report presents the scheduled annual revision of the ADP National Employment Report, which updates the data series to be consistent with the annual Quarterly Census of Employment and Wages (QCEW) benchmark data for March 2022.

In addition, this revision introduces some methodological changes, namely, in re-weighting of ADP data to match QCEW data, seasonal adjustment of weekly data instead of monthly data, and constructing the national aggregate from industry aggregates. The historical file was updated to reflect these revisions.

To subscribe to monthly email alerts or obtain additional information about the ADP National Employment Report, including employment and pay data, interactive charts, methodology, and a calendar of release dates, please visit https://adpemploymentreport.com/.

The February 2023 ADP National Employment Report will be released at 8:15 a.m. ET on March 8.