ROSELAND, N.J. - The U.S. private sector saw an increase of 233,000 jobs in October, while annual pay rose by 4.6 percent compared to the same month last year, according to the ADP National Employment Report. This collaboration between ADP Research and the Stanford Digital Economy Lab provides a high-frequency view of the labor market, drawing from actual payroll data of over 25 million U.S. employees.
Despite challenges such as hurricane recovery, job growth in October was robust, marking the highest level of job creation since July 2023. The service-providing sector contributed 211,000 jobs, with notable gains in education/health services and leisure/hospitality. The goods-producing sector also saw growth, although manufacturing experienced a loss of 19,000 jobs.
Regional analysis showed varied performance across the United States, with the Northeast adding 48,000 jobs and the South leading with a 77,000 increase. Establishment size played a role in job distribution, with large establishments (500+ employees) accounting for 140,000 added jobs.
Pay insights revealed a continuation of a two-year slowdown in wage increases. Job-stayers saw a median annual pay gain of 4.6 percent, while job-changers experienced a slower gain of 6.2 percent. The report also provided detailed pay change insights by industry sector and firm size.
The data for September was revised, showing an increase from the previously reported 143,000 jobs to 159,000. This report is part of ADP's commitment to providing deeper insights into the U.S. labor market and serves as a valuable information source for businesses and governments.
The next ADP National Employment Report is scheduled for release on December 4, 2024. This report is based on a press release statement and offers an independent measure of U.S. private employment and pay trends.
In other recent news, ADP reported impressive first quarter fiscal 2025 results, surpassing analyst estimates and raising its full-year guidance. The company's adjusted earnings per share reached $2.33, surpassing the anticipated $2.21, and revenue for the quarter increased 7% YoY to $4.83 billion, exceeding the consensus forecast of $4.77 billion. This strong performance was fueled by robust new business bookings growth, improved client revenue retention, and higher client funds interest revenue.
Following its recent acquisition of WorkForce Software, ADP revised its full-year outlook, expecting revenue growth of 6% to 7%, an increase from its previous guidance. Adjusted diluted EPS growth is also projected at 7% to 9%, marking another increase from earlier forecasts.
The company's Employer Services segment anticipates revenue growth of 6% to 7%, with new business bookings growth of 4% to 7%. Meanwhile, the PEO Services segment expects a revenue growth of 5% to 6%. These recent developments highlight ADP's strong financial performance and strategic progress, as noted by the company's CEO, Maria Black, and CFO, Don McGuire.
InvestingPro Insights
ADP's robust performance in facilitating job growth aligns with its strong market position and financial health. According to InvestingPro data, ADP boasts a substantial market capitalization of $117.43 billion, reflecting its significant role in the Professional Services industry. The company's revenue growth of 6.61% over the last twelve months demonstrates its ability to expand its business in line with the increasing employment trends it reports.
An InvestingPro Tip highlights that ADP has raised its dividend for 25 consecutive years, showcasing its financial stability and commitment to shareholder returns. This is particularly relevant given the positive employment data, as it suggests ADP's business model remains resilient in varying economic conditions.
The company's strong financial position is further underscored by its impressive gross profit margin of 47.89% and operating income margin of 26.14% for the last twelve months. These metrics indicate ADP's efficiency in managing costs while growing its business, which is crucial in the competitive payroll and human resources services sector.
Another InvestingPro Tip notes that ADP operates with a moderate level of debt, which is advantageous in the current economic climate of rising interest rates. This financial prudence allows ADP to maintain flexibility and potentially invest in growth opportunities as the job market continues to evolve.
For investors seeking more comprehensive insights, InvestingPro offers 13 additional tips on ADP, providing a deeper understanding of the company's financial health and market position.
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