Private payrolls posted better-than-expected growth of 143,000 in September, according to ADP

Private sector hiring increased in September, suggesting the labor market is holding up despite some signs of weakness, payroll company ADP reported on Wednesday.

Companies added 143,000 jobs this month, an acceleration from the upwardly revised 103,000 in August and better than the 128,000 consensus forecast of economists surveyed by Dow Jones.

While new hiring increased, the rate of wage growth fell again. The 12-month gain for those keeping their jobs fell to 4.7%, while for job changers it fell to 6.6%, down 0.7 percentage points from August.

Employment gains were fairly widespread, with leisure and hospitality leading the way at 34,000, followed by construction (26,000), education and health services (24,000), professional and business services (20,000) and other services (17,000).

Information services was the only category to post a loss of 10,000.

Of these, 101,000 went to service providers and the rest to goods producers.

In terms of size, all of the growth came from companies with more than 50 employees. Small businesses recorded losses, with those with fewer than 20 employees seeing a decline of 13,000.

The ADP count comes two days ahead of the Labor Department’s nonfarm payrolls report, which is expected to show growth of 150,000 after reporting a disappointing figure of 142,000 in August, of which 118,000 came from private sector hiring.

While the ADP report serves as a precursor to the official count, the two values ​​can sometimes differ greatly.

Federal Reserve officials are closely watching the jobs numbers as they consider the next move on monetary policy and interest rates. In a speech on Monday, Fed Chairman Jerome Powell called the labor market “solid” and noted that it had “cooled significantly” over the past year.

The Fed is expected to follow up its half-percentage point rate cut in September with further cuts in November and December. The main question is whether the central bank will move in the same big step or revert to a more conventional quarter-point step.

Futures prices are currently pointing to a quarter-point decline in November and then a half-point move in December. Powell noted that back-to-back quarter percent moves are now the more likely scenario, although policymakers will remain attuned to the data and make adjustments accordingly.