WASHINGTON — The U.S. private sector unexpectedly lost 33,000 jobs in June, signaling potential weakness in the labor market amid ongoing uncertainty over President Donald Trump’s tariff policies, according to payroll processing firm ADP.
The report, released Wednesday, marks the first contraction in private employment in recent months. ADP also revised job growth for May downward to 29,000, suggesting a trend of slowing momentum.
“Though layoffs continue to be rare, a hesitancy to hire and a reluctance to replace departing workers led to job losses last month,” said Nela Richardson, ADP’s chief economist. However, she noted that the hiring slowdown has not yet impacted pay growth.
The decline in jobs was most evident in professional and business services, as well as education and health services. On the other hand, the leisure and hospitality sector, along with manufacturing, saw modest job gains.
Despite the job losses, wage growth remained stable. Workers who stayed in their roles saw annual pay increases of 4.4%, while those who changed jobs experienced a slightly lower rise of 6.8% in June.
The ADP figures arrive just days before the release of the U.S. government’s official employment report, which will be closely watched for further signs of economic strain.
“This is the first time that we’re seeing the job market disappoint and actually contract in recent months,” said Adam Sarhan, CEO of 50 Park Investments. “And that is worrisome because up until now unemployment has been low and jobs have been strong and growing.”
