March Private Sector Employment Growth Exceeds Expectations

In March 2026, private sector employment growth in the United States totaled 62,000 jobs, surpassing the Dow Jones consensus estimate of 39,000. This figure, reported by payroll processing company ADP, reflects a slight decline of 4,000 jobs from February's upwardly revised total. Notably, the growth was predominantly driven by the health care and construction sectors, which together accounted for the majority of the job gains.

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The health care sector, including education and health services, contributed 58,000 jobs, maintaining the same level as in February. This growth was particularly significant as it followed the resolution of a strike at Kaiser Permanente that had previously sidelined over 30,000 workers in Hawaii and California. The construction industry added 30,000 jobs, further bolstering the overall employment figures. Other sectors that saw job increases included information services with 16,000 jobs, natural resources and mining with 11,000, and leisure and hospitality with 7,000. Conversely, the trade, transportation, and utilities sector experienced a loss of 58,000 jobs, while manufacturing saw a decline of 11,000.

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Small businesses, defined as those with fewer than 50 employees, were the primary drivers of job creation, adding 85,000 jobs in March. This marked the second consecutive month of strong hiring from small firms, a trend that ADP's chief economist Nela Richardson attributed to a potential "catch-up" effect in response to inflation pressures and the need for additional income among workers. In contrast, medium-sized businesses lost 20,000 jobs, and large firms reported a decline of 4,000 jobs.

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Wage growth remained stable, with employees who stayed in their positions seeing an increase of 4.5%, while those who changed jobs experienced a more significant gain of 6.6%, up 0.3 percentage points from February. This report comes ahead of the Bureau of Labor Statistics' nonfarm payrolls report, which is anticipated to show a gain of 59,000 jobs following a reported loss of 92,000 in February. The unemployment rate is expected to remain steady at 4.4%.

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While the overall job growth figures appear positive, some analysts express concern about the reliance on specific sectors, particularly health care, for employment gains. Critics argue that this concentration may indicate vulnerabilities in other sectors, particularly manufacturing and trade, which have shown significant job losses.

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“That's really the story. Health care is transforming the labor market.” — Nela Richardson, Chief Economist, ADP

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