US Economy: Businesses Add Healthy 156,000 Jobs In July, Labor Department Says Wages Only Increasing Slightly

American businesses exceed economists' average forecast in July, adding 156,000 private-sector jobs for the month, according to a report released Wednesday by payroll processor Automatic Data Processing (ADP).

Dow Jones estimates were for 150,000 jobs. In June, nonfarm payrolls rose 224,000, which was well above market expectations of 165,000, according to the Department of Labor.

The ADP report noted that transportation, construction, healthcare and hospitality sectors were some of the parts of the economy adding new jobs.

But ADP reported that small businesses with under 20 employees are still struggling to find workers.

The survey only includes private businesses, not the U.S. government.

Although U.S. businesses are hiring at a healthy rate, the Labor Department suggested that wages have not increased as rapidly as expected this summer. Pay and benefits for American workers only increased by 2.7% from April-June.

Typically in a strong labor market, employers have to increase salaries and benefits to attract employees, as workers have many options for employment to choose from.

Last week, the GDP was revealed to have increased only 2.1% in the second quarter of 2019, which fell short of President Trump's goal of hitting over 3% GDP growth.

Economists blame slow residential and business investment for the modest increase, along with Trump's aggressive tariff policies against major economies such as China.

Trump believes that the economy would be even stronger if the Federal Reserve under Chairman Jerome Powell would lower rates. So far, Powell has increased rates as Chairman in order to curb inflation, with is called contractionary monetary policy.

Powell on Wednesday might lower rates, due to "uncertainties" in the global economy, such as decreasing global GDP growth and trade tensions.

At the end of the week, the federal government will reveal the unemployment rate for July. The June employment rate was relatively strong, at 3.7%.