ADP National Employment Report: Private Sector Employment Increased by 155,000 Jobs in March; Annual Pay was Up 4.6%
Rhea-AI Summary
ADP's March 2025 National Employment Report shows private sector employment increased by 155,000 jobs, with annual pay rising 4.6% year-over-year. The report highlights significant sector-specific changes, with manufacturing adding 21,000 jobs and financial activities gaining 38,000 positions.
By establishment size, large companies (500+ employees) led job creation with 59,000 new positions, followed by small establishments adding 52,000 jobs, and medium-sized businesses contributing 43,000 jobs. Regional data showed strong growth in the Northeast (89,000) and Midwest (81,000), while the West experienced a decline (-41,000).
Pay insights revealed job-changers earned a premium of 1.9 percentage points over job-stayers, with their wages increasing by 6.5% compared to 4.6% for those who remained in their positions. The February jobs number was revised upward from 77,000 to 84,000.
Positive
- Private sector added 155,000 jobs, nearly double February's revised 84,000
- Manufacturing sector showed strong performance with 21,000 new jobs
- Financial activities sector added 38,000 jobs
- Professional/business services sector led job creation with 57,000 new positions
- Consistent job growth across all establishment sizes
Negative
- West region lost 41,000 jobs
- Trade/transportation/utilities sector lost 6,000 jobs
- Natural resources/mining sector declined by 3,000 jobs
- Pay growth slowed, with job-changers' premium matching series low
- Small business (1-19 employees) wage growth notably low at 2.9%
Insights
The ADP National Employment Report demonstrates solid labor market resilience with 155,000 private sector jobs added in March, substantially above February's revised 84,000 figure. This employment growth directly benefits ADP's core business model as a payroll processor, since their revenue scales with the number of employees on their clients' payrolls.
Most impressive is the broad-based growth across company sizes, with small businesses adding 52,000 jobs, medium establishments adding 43,000, and large companies adding 59,000. This balanced distribution aligns perfectly with ADP's diverse client portfolio across business segments.
The sectoral analysis reveals particularly strong gains in high-value segments: financial activities (+38,000) and professional/business services (+57,000) - sectors that typically utilize ADP's more comprehensive HR and payroll solutions with higher margins.
From an investor perspective, the report showcases ADP's expanding data analytics capabilities, now capturing 14.8 million monthly pay observations (up from 10 million at launch). This growing dataset strengthens ADP's competitive moat as a workforce intelligence provider beyond basic payroll processing.
The moderating annual pay growth of 4.6% for job-stayers indicates cooling wage inflation while remaining above historical averages - a "Goldilocks" scenario that supports continued employment growth without triggering aggressive monetary tightening that could hurt ADP's interest income on funds held for clients.
The March employment data reveals nuanced regional economic realignment that warrants attention. The Northeast (+89,000 jobs) and Midwest (+81,000) showed remarkable strength, while the West region lost 41,000 jobs - suggesting a potential geographic shift in economic activity that companies like ADP are uniquely positioned to identify through their payroll data.
Manufacturing's second consecutive month of stronger-than-average gains (+21,000 jobs) contradicts broader narratives about manufacturing decline and represents high-quality job creation in a sector with comprehensive benefits administration needs.
The narrowing pay premium for job-changers to 1.9 percentage points (matching a series low) signals decreasing labor market churn and potentially improving employee retention - a subtle but important indicator of labor market normalization after years of volatility.
The construction sector's slowing job growth (+6,000) despite the typically robust spring hiring season warrants monitoring as a potential leading indicator for economic headwinds. Similarly, the contraction in trade/transportation/utilities (-6,000) suggests potential softness in consumer spending and logistics activity.
For payroll processors like ADP, these sectoral shifts offer opportunities to provide strategic workforce guidance beyond transaction processing. The detailed industry and regional breakdowns demonstrate ADP's ability to capture granular labor market trends through their vast dataset covering over 25 million U.S. employees, reinforcing their value proposition as both a service provider and data authority.
The jobs report and pay insights use ADP's fine-grained anonymized and aggregated payroll data to provide a representative picture of the private-sector labor market. The report details the current month's total private employment change, and weekly job data from the previous month. Because the underlying ADP payroll databases are continuously updated, the report provides a high-frequency, near real-time measure of
"Despite policy uncertainty and downbeat consumers, the bottom line is this: The March topline number was a good one for the economy and employers of all sizes, if not necessarily all sectors," said Nela Richardson, chief economist, ADP.
March 2025 Report Highlights*
View the ADP National Employment Report and interactive charts at www.adpemploymentreport.com.
JOBS REPORT
Private employers added 155,000 jobs in March
Manufacturing delivered stronger-than-average job gains for the second straight month. Construction hiring slowed. Natural resources and trade, transportation, and utilities lost jobs.
Change in
Change by Industry Sector
- Goods-producing: 24,000
- Natural resources/mining -3,000
- Construction 6,000
- Manufacturing 21,000
- Service-providing: 132,000
- Trade/transportation/utilities -6,000
- Information 3,000
- Financial activities 38,000
- Professional/business services 57,000
- Education/health services 12,000
- Leisure/hospitality 17,000
- Other services 11,000
Change by
- Northeast: 89,000
- New England 57,000
- Middle Atlantic 32,000
- Midwest: 81,000
- East North Central 76,000
- West North Central 5,000
- South: 27,000
- South Atlantic 7,000
- East South Central 24,000
- West South Central -4,000
- West: -41,000
- Mountain -12,000
- Pacific -29,000
Change by Establishment Size
- Small establishments: 52,000
- 1-19 employees 42,000
- 20-49 employees 10,000
- Medium establishments: 43,000
- 50-249 employees 34,000
- 250-499 employees 9,000
- Large establishments: 59,000
- 500+ employees 59,000
PAY INSIGHTS
Pay gains slowed in March
Year-over-year pay gains slowed to 4.6 percent for job-stayers and to 6.5 percent for job-changers. The pay premium for job-changers was 1.9 percentage points, matching a series low last seen in September.
Median Change in Annual Pay (ADP matched person sample)
- Job-Stayers
- Job-Changers 6.
Median Change in Annual Pay for Job-Stayers by Industry Sector
- Goods-producing:
- Natural resources/mining
4.3% - Construction
4.7% - Manufacturing
4.8%
- Service-providing:
- Trade/transportation/utilities
4.3% - Information
4.0% - Financial activities
5.3% - Professional/business services
4.4% - Education/health services
4.7% - Leisure/hospitality
4.7% - Other services
4.4%
Median Change in Annual Pay for Job-Stayers by Firm Size
- Small firms:
- 1-19 employees
2.9% - 20-49 employees
4.2%
- Medium firms:
- 50-249 employees
4.8% - 250-499 employees
5.0%
- Large firms:
- 500+ employees
4.9%
To see Pay Insights by
* Sum of components may not equal total due to rounding.
The February total number of jobs added was revised from 77,000 to 84,000. The historical data file and weekly data for the previous month are available at https://adpemploymentreport.com/.
To subscribe to monthly email alerts or obtain additional information about the ADP National Employment Report, including employment and pay data, interactive charts, methodology, and a calendar of release dates, please visit https://adpemploymentreport.com/.
The April 2025 ADP National Employment Report will be released at 8:15 a.m. ET on April 30, 2025.
About the ADP® National Employment Report™
The ADP National Employment Report is an independent measure of the change in
The ADP National Employment Report is broadly distributed to the public each month, free of charge, as part of the company's commitment to offering deeper insights of the
About the ADP Research
The mission of ADP Research is to make the future of work more productive through data-driven discovery. Companies, workers, and policymakers rely on our finely tuned data and unique perspective to make informed decisions that impact workplaces around the world.
About ADP (NASDAQ – ADP)
Designing better ways to work through cutting-edge products, premium services and exceptional experiences that enable people to reach their full potential. HR, Talent, Time Management, Benefits and Payroll. Informed by data and designed for people. Learn more at ADP.com
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SOURCE ADP, Inc.
FAQ
How many private sector jobs were added according to ADP's March 2025 report?
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Which regions showed the strongest and weakest job growth in ADP's March report?
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