Private payrolls rose by 278,000 in May, well ahead of expectations, ADP says

The U.S. labor market posted another month of surprising strength in May as companies added jobs at a pace well above expectations, according to a report Thursday from payroll processing firm ADP.

Private sector employment increased by a seasonally adjusted 278,000 for the month, ahead of the Dow Jones estimate for 180,000 and a bit lower than the downwardly revised 291,000 in April. May’s increase took the payroll growth so far in 2023 to 1.09 million.

The ADP report noted that the distribution of job gains was “fragmented” for the month, as increases were concentrated in leisure and hospitality, which added 208,000 positions, and natural resources and mining, which saw a gain of…