ADP Reports 86,000 New Jobs in October, Beating Forecasts

U.S. businesses added 86,000 jobs in October, beating the Wall Street forecast of 75,000, payroll processor ADP said Wednesday. It was the second consecutive month at that level, and hiring broadened across more industries — a small sign of improvement in a sluggish labor market.

The gain came in above expectations even though the overall pace of job creation remains weak. More sectors joined the hiring effort, but employers stayed cautious about expanding their workforces.

What did ADP's chief economist say?

Nela Richardson, chief economist at ADP, said employers competed for workers on several fronts, not just base pay. "Employers of all sizes were hiring last month, and our data suggests that job-changers were lured by a combination of bonuses, overtime, and more hours in addition to higher base pay," Richardson said.

That detail matters. It shows firms are willing to pay more to fill positions, but they prefer flexible add-ons — bonuses and overtime — over permanent salary commitments they would have to sustain if the economy weakened.

Which industries drove the hiring?

The October gains were spread wider than usual:

• Transportation added 39,000 jobs, the sector's biggest monthly increase in almost two years.
• Healthcare providers again led the way in hiring, as they have for the past few years.
• Hotels, restaurants, financial firms and construction companies also added more jobs.

Transportation stands out. A jump that size in a sector tied to moving goods suggests demand for logistics capacity picked up, at least temporarily. Healthcare, by contrast, reflects a long-running structural demand for workers rather than a shift in the business cycle.

ADP also revised its September figure downward. Private-sector job growth that month came in at 86,000, down from an initial reading of 90,000.

How does this relate to Friday's official jobs report?

The ADP report is a forerunner to the official U.S. employment report due Friday from the Bureau of Labor Statistics. Economists predict a 59,000 increase in new jobs for October based on BLS data.

The two reports sometimes differ sharply month to month. Over time, however, they head in the same direction. ADP tracks private payrolls through its own client data; the BLS surveys employers directly. A gap between the two in October would not be unusual.

Why is the labor market still described as stuck?

The big picture: the U.S. labor market is stuck in a rut. Layoffs are historically low — but so is hiring. The economy has been adding well under 100,000 jobs a month since the middle of 2024, less than half its historical average.

That combination defines the current market. Workers who have jobs keep them, because companies are not cutting. But workers without jobs, or those seeking better ones, face a thin market with few openings relative to historical norms.

ADP's data suggests hiring is unlikely to accelerate sharply in the short term. The October gain, while broader across industries, still sits below the levels that marked the post-pandemic hiring boom.

How did markets respond?

The Dow Jones Industrial Average and the S&P 500 were set to rise in Wednesday trading. The market move followed historic gains by Democrats in U.S. elections, rather than a direct reaction to the jobs data alone.

For businesses and policymakers, the report lands as a data point ahead of Friday: modest growth, wider participation, and no sign yet that the hiring rut is breaking.