Private sector employment rose by 129,000 workers in March, according to data released Wednesday, increasing at its slowest pace in 18 months.
The ADP National Employment Report, a closely watched gauge of monthly job gains conducted with Moody’s Analytics, showed a significant slowdown in hiring across several industries.
“The job market is weakening, with employment gains slowing significantly across most industries and company sizes,” said Mark Zandi, chief economist at Moody’s Analytics.
“Businesses are hiring cautiously as the economy is struggling with fading fiscal stimulus, the trade uncertainty, and the lagged impact of Fed tightening.”
Zandi also warned, “If employment growth weakens much further, unemployment will begin to rise.”
The lag in hiring is the latest sign the U.S. economy could be losing strength after more than a decade of consistent growth following the 2008 recession.
While the U.S. economy continues to benefit from low unemployment and solid gross domestic product (GDP) growth, a raft of inconsistent data on retail sales, trade, construction and spending has raised concerns about impending economic trouble.
“March posted the slowest employment increase in 18 months,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “Although some service sectors showed continued strength, we saw weakness in the goods producing sector.”
Public and private sector economists expect U.S. growth to slow in 2019 after increasing to 2.9 percent last year. The Federal Reserve and Congressional Budget Office have both projected 2.3 percent GDP growth in 2019, which are in line with estimates from private analysts.
The White House Council of Economic Advisers (CEA) are far more bullish about the economy and projected 3 percent growth through 2024, the final possible year of President TrumpDonald TrumpYoungkin ad features mother who pushed to have 'Beloved' banned from son's curriculum White House rejects latest Trump claim of executive privilege Democrats say GOP lawmakers implicated in Jan. 6 should be expelled MORE’s presidency.
CEA Chairman Kevin Hassett on Tuesday said that the economy is “completely on track to have another 3 percent year” thanks to expected increases in output triggered by the 2017 corporate tax cut.
Hassett said that increased investment in productivity-boosting equipment and a tight labor market should propel the economy throughout 2019.
“The likelihood that the policies causing the boom right now getting repealed between this year and next year is close to zero,” Hassett said at a conference hosted by the American Bankers Association.
“The level of confidence that you’re going to have a pretty solid year is pretty high.”