Private employers added 164,000 jobs in December, and wages rose 5.4% from a year earlier, according to a national employment report released Thursday by the ADP Institute.
“We are returning to a labor market that closely matches pre-pandemic employment,” ADP chief economist Nella Richardson said in a press release. She said: “While wages did not cause the recent inflation, the risk of a wage-price spiral has all but disappeared now that wage growth has receded.”
Private sector employment rose for the fourth consecutive month in December, with significant gains in leisure and hospitality industries, which have been devastated by the pandemic.
The ADP report notes that high interest rates introduced by the Federal Reserve are hurting some sectors. Construction employment remained strong, but manufacturing struggled.
The ADP jobs report is a prelude to Friday's jobs report. The Bureau of Labor Statistics is scheduled to release federal statistics on job growth in December, as Congress returns from vacation and the Republican presidential primary is scheduled to begin this month.
President Biden has touted strong jobs numbers as part of his economic platform for re-election. Amid the Fed's rare soft landing, it will also keep an eye on employment data as it considers when and how to lower interest rates.
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