The ADP national employment report put job gains at 150,000 in June after a small upward revision to 157,000 in May. The June increase is slightly below the consensus of 161,000 in the Econoday survey of forecasters, but not materially different. Job gains have been trending lower since March, however, these remain consistent with a healthy labor market.

Goods producers added 14,000 new jobs on net, but the gain is entirely due to a 27,000 rise in construction while manufacturing is down 5,000 and natural resources/minding down 8,000.

Service providers added 136,000 new jobs in June, nearly half of which was a 63,000 increase in leisure/hospitality. There are moderate gains of 25,000 in professional/business services, 16,000 in"other" services, 15,000 in trade/transportation/utilities, 11,000 in financial activities, and 9,000 in education/health services. Hiring in information is down 3,000.

All sizes of establishments brought workers on payroll in June. Small establishments (1-49 employees) added 5,000, medium establishments (50-499) added 88,000, and large firms (500+) added 58,000.

Competition for qualified workers is still stiff though it is easing. The median change in pay for job-stayers from a year ago is up 4.9 percent, down from 5.0 percent in May, but cooler than 6.4 percent in June 2023. The median change in pay for job-changers is up 7.7 percent in June after 7.8 percent in May, and down from 11.3 percent in the year-ago month.

Forecasters see ADP's June employment number at 161,000. This would compare with May growth in private payrolls reported by the Bureau of Labor Statistics of 229,000. ADP's number for May was 152,000.

The national employment report from Automated Data Processing Inc. is computed from ADP payroll data and offers advance indications on the U.S. workforce. ADP's data cover more than 500,000 companies totaling more than 25 million employees. The report is produced by ADP Research Institute in collaboration with Stanford Digital Economy Lab.

Market players have become accustomed to the excitement on employment Friday and realize the rich detail of the monthly employment situation can help set the tone for the entire month. While economists have improved their nonfarm payroll forecasts over the years, it is not unusual to see surprises on employment Friday. To that end, the ADP's national employment report can help improve the payroll forecast by providing information in advance of the employment report.

The employment statistics also provide insight on wage trends, and wage inflation is high on the list of enemies for the Federal Reserve. Fed officials constantly monitor this data watching for even the smallest signs of potential inflationary pressures, even when economic conditions are soggy. If inflation is under control, it is easier for the Fed to maintain a more accommodative monetary policy. If inflation is a problem, the Fed is limited in providing economic stimulus.

By tracking jobs, investors can sense the degree of tightness in the job market. If wage inflation threatens, it's a good bet that interest rates will rise; bond and stock prices will fall. No doubt that the only investors in a good mood will be the ones who watched the employment report and adjusted their portfolios to anticipate these events. In contrast, when job growth is slow or negative, then interest rates are likely to decline - boosting up bond and stock prices in the process.