A significant discrepancy between the US government’s official jobs report and private-sector data has reignited debate over the state of the American labor market, CNBC reports.
While official figures from the Bureau of Labor Statistics (BLS) showed stronger-than-expected job growth in June, a separate report from payroll processing firm ADP painted a starkly different picture.
According to the BLS, the US economy added 147,000 nonfarm jobs last month, surpassing expectations of 110,000. The unemployment rate also declined to 4.1% from 4.2%, contrary to forecasts for a slight increase. However, the ADP National Employment Report, which tracks private sector hiring, reported a loss of 33,000 jobs in June — not just a different figure, but a completely opposite trend.
This divergence has prompted scrutiny from economists and market watchers. Analysts noted that a large portion of June’s job gains came from the public sector. Government employment rose by 73,000 jobs, accounting for nearly half of the total job growth. Because ADP’s report only covers private sector employment, it does not reflect these gains.
Cory Stahle, an economist at Indeed Hiring Lab, highlighted that job seekers outside of sectors such as healthcare, local government, and education might not be experiencing the broader gains seen in the headline figures.
“The headline job gains and surprising dip in unemployment are undoubtedly good news,” Stahle wrote, “but for many job seekers, the gains may feel disconnected from their experience.”
The discrepancy underscores the complexities of today’s labor market. While official data suggests resilience, particularly in public sector hiring, the private job market may be feeling pressure from broader economic uncertainty and shifts in corporate hiring strategies.
Adding to the economic landscape, US equity markets responded positively to the jobs report. The S&P 500 and Nasdaq Composite each hit new record highs on Thursday, buoyed by optimism around labor market strength and easing inflation concerns. However, US Treasury yields also climbed, reflecting ongoing caution among bond investors.
Elsewhere in financial news, Indian regulators issued a temporary trading ban on US firm Jane Street over alleged market manipulation, and President Donald Trump secured a major political win with the narrow passage of a sweeping tax-and-spending bill in the House. Notably, amendments to the bill brought relief to European renewable energy firms, offering some optimism for the sector.
