The ADP report comes two days before the closely watched Department of Labor’s nonfarm payrolls release and as the Federal Reserve weighs how much cooling is underway in the job market.

The July jobs gain exceeded consensus expectations of roughly 78,000 and signals renewed hiring momentum after a weak spring. Annual pay growth remained steady at 4.4 percent for workers staying in their jobs and 7 percent for those switching roles, ADP said.

“Our hiring and pay data are broadly indicative of a healthy economy,” Nela Richardson, ADP chief economist, said in a statement. “Employers have grown more optimistic that consumers, the backbone of the economy, will remain resilient.”

ADP’s data showed notable gains in leisure and hospitality, which added 46,000 jobs, along with increases in financial activities and construction. Education and health services, by contrast, shed 38,000 positions, continuing a months‑long slide in that sector.

Large employers led the rebound with 46,000 new hires. Small businesses added 22,000 jobs, while firms with 20–49 employees lost positions—a “mid‑size business squeeze” tied to higher borrowing costs and slimmer margins, according to Sergio Altomare, cofounder and CEO of Hearthfire Holdings.

This is “not a blowout by any stretch, but it’s definitely a rebound from the June decline,” Altomare told The Epoch Times in an emailed statement. “We’re witnessing a labor market that’s not hot, but isn’t rolling over either—and that is precisely what the Fed desires in these circumstances.”

Altomare added that concentrated gains in services spending, coupled with ongoing wage stickiness, give the central bank space “to remain patient” on rate decisions as it gauges inflation risks.

“Bottom line: This is a labor market that still has legs,” he said. “Not stalling, not sprinting. Just jogging—and that’s all the Fed wants to see.”

Lacey Kaelani, CEO of job-search platform Metaintro, said real-time job posting data foreshadowed the uptick.

“Companies were posting 30 percent more roles in mid-June through July compared to the previous month,” she told The Epoch Times in an emailed statement. “The rebound wasn’t surprising from our platform perspective because we track employer intent in real-time, not just hiring completions.”

“Our data suggests the BLS numbers could be even stronger because we’re seeing increased government and public sector job postings in our index,” Kaelani said. “Plus, small-business hiring (which ADP sometimes misses) is picking up based on our SMB [small and medium-sized business] client data.”

The ADP report lands hours before the Federal Open Market Committee, the Federal Reserve’s rate-setting body, announces its latest policy decision. The central bank is widely expected to keep rates steady around the 4.3 percent mark after three cuts last year, as Fed Chair Jerome Powell waits to see how U.S. tariffs and fiscal policies affect inflation and growth.

President Donald Trump has criticized Powell for holding rates too high, urging deeper cuts to ease borrowing costs and lower the government’s interest burden.