Hiring in the private sector increased in October compared to the prior month, with private employers adding 239,000 jobs during the past month, according to a new report.
The ADP National Employment Report, which is released monthly and estimates private sector employment levels and pay, found that annual pay rose 7.7 percent on a year-over-year basis.
The number of new hires in October is an improvement from the estimated 192,000 added private sector jobs that ADP estimated in September, but not all industries are expanding.
“This is a really strong number given the maturity of the economic recovery, but the hiring was not broad-based. Goods producers, which are sensitive to interest rates, are pulling back, and job changers are commanding smaller pay gains,” said Nela Richardson, the chief economist for ADP.
The Federal Reserve has repeatedly raised interest rates through the year to combat high levels of inflation and is expected to raise rates another 0.75 percentage points on Wednesday. Fed Chairman Jerome Powell has said he is willing to raise rates as much as necessary to get inflation under control, even if it means causing economic pain as a result.
Some economists have expressed concerns about the Fed going too far in raising rates, but the inflation rate has continued to hover around 8 percent and the labor market remains strong.
In addition, U.S. gross domestic product increased in the third quarter this year after two months of contraction.
However, experts have warned that the effects of the Fed’s monetary policy will not be felt until 2023.
“While we’re seeing early signs of Fed-driven demand destruction, it’s affecting only certain sectors of the labor market,” Richardson said.
The ADP report showed the most growth occurred in the leisure and hospitality industry with 210,000 new jobs, followed by trade, transportation and utilities with 84,000 new jobs. The manufacturing industry lost 20,000 jobs in the past month.
The report is based on data derived from ADP client payrolls.