US market opened flat on Thursday following a weaker-than-expected private payrolls report. In the early hours of trading, the Dow Jones Industrial Average dropped 66.4 points, or 0.15%, to 45,204.87. The S&P 500 gained 8.3 points, or 0.13%, to 6,456.6, while the Nasdaq Composite gained 42.2 points, or 0.20%, to 21,539.91.
Private payrolls in the US grew by 54,000 jobs in August, falling short of economists’ expectations of a 65,000 increase, according to the ADP National Employment Report which was released today.
The report, which was released on Thursday, showed a slight upward revision in July’s numbers to 106,000 from the previous 104,000. Despite the growth, the labour market continues to show signs of softening, with economists attributing some of the slowdown to President Donald Trump’s import tariffs and stricter immigration policies, which have particularly impacted hiring in construction and hospitality industries.
A separate report from Challenger, Gray & Christmas revealed a significant rise in job cuts, with US-based employers announcing 85,979 layoffs in August, a 39 per cent jump from the previous year.
This marks the highest August total since 2020. Additionally, a government report indicated that, for the first time since the pandemic, there are more unemployed individuals than job openings.
The upcoming government employment report is expected to show a modest increase in nonfarm payrolls of about 75,000 jobs, with the unemployment rate likely climbing to 4.3 per cent.
Federal Reserve Chairman Jerome Powell recently hinted at the possibility of a rate cut due to labour market concerns, while inflation continues to pose a challenge.