America’s private employers added only 54,000 jobs in August, much lower than economists’ already modest expectations of 68,000.
That data
comes courtesy of payroll processor ADP and marks a steep slowdown from July’s upwardly revised 106,000, underscoring how fragile employment momentum has become halfway through 2025.
“The year started with strong job growth, but that momentum has been whipsawed by uncertainty,” Nela Richardson, ADP’s chief economist, said in the press release.
She cited a mix of factors “including labor shortages, skittish consumers, and AI disruptions.”
That last one is important. ADP’s August report is among the first to name-check AI disruptions, a rare admission that artificial intelligence is now beginning to reshape hiring sentiment.
The top-line figure hides stark divides across the economy. Almost all of August’s gains came from leisure and hospitality; remove those and private payrolls came out essentially flat, with job losses in manufacturing (-7,000), health and education (-12,000), and trade, transportation, and utilities (-17,000).
Wage growth showed signs of cooling but remained stronger for job-switchers. Pay for job-stayers rose 4.4% year over year in August, while job-changers’ ticked up 7.1%.
August’s sluggish private‑sector hiring has added new fuel to the expectation that the Fed will ease monetary policy at its Sept. 16–17 meeting. Markets are now pricing in a nearly 90%–98% probability of a 25‑basis‑point rate cut.
—Eva Roytburg 
