The ADP National Employment Report showed private employment up 122,000 in December, just missing expectations of a 140,000 increase. Small businesses added just 5,000 jobs, and mid-sized firms also saw slow hiring at just 9,000. Large firms added almost all of the jobs at 97,000. The goods sector added 10,000 jobs while the services sector added the rest of the 110,000 jobs, led by a 57,000 increase in education and health services employment.

With slower hiring growth came slightly slower wage growth, the YoY increase in annual pay for job changers fell from 7.2% YoY to 7.1% YoY in December, and for job stayers fell from 4.8% YoY to 4.6% YoY. The deceleration in job stayers annual pay growth puts it at the lowest rate since July 2021