After months of a hot job market, data from payroll company ADP finds that the labor market is cooling.
In November, employers added 127,000 jobs, with medium-sized firms boasting the largest number of new workers ahead of small and large firms.
“Turning points can be hard to capture in the labor market, but our data suggest that Federal Reserve tightening is having an impact on job creation and pay gains,” said Nela Richardson, chief economist at ADP.
“In addition, companies are no longer in hyper-replacement mode. Fewer people are quitting and the post-pandemic recovery is stabilizing.”
Because quit rates have slowed, experts predict that employers will gain the upperhand as a recession threatens job security for many employees. While recent data shows that job openings still outweighed available workers, it is expected that hiring will slow in the new year as companies prepare for the economic downturn.
“We remain in unprecedented times,” said Ron Hetrick, senior economist at Lightcast. “Companies keep hearing the ‘R’ word, yet quits remain elevated historically speaking, and at this point job openings are still 40% higher than pre-pandemic levels.”