Greetings and welcome to the ADP National Employment Report Media Conference Call. During the presentation, all participants will be in a listen only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press one followed by four on your telephone. If at any time during the conference you need to reach an operator, please press star zero. As a reminder, this conference is being recorded Wednesday, May 4, 2022. I would now like to turn the conference over to Ms. Joanna DiNizio with ADP. Please go ahead.
Thank you. Good morning and welcome to the April 2022 ADP National Employment Report Media Conference Call. With us is Nela Richardson, Chief Economist at ADP. Nela will share her thoughts on the April findings, which is derived from ADP's actual data of those who are on a company's payroll and produced in collaboration with Moody's Analytics. She'll take as many of your questions as possible before our hard stop at 9:00 A.M. Nela, please go ahead.
Hi, everyone. Thank you, Joanna, and good morning. I'm aware that there is also big news this afternoon with the Federal Reserve announcement, but I hope to give you some color on what we're seeing in the jobs market and how that is shaping up in terms of fundamentals as the Fed continues its monetary policy decision making. The labor market recovery is moderating. Some would say actually normalizing as the economy is approaching full employment. In April, private sector payrolls rose by 247,000 on net. That's down from the 2021 average of 573,000 and down from the first quarter average of monthly average of 530,000. The moderation in April was broad-based, with job gains flowing for both goods and service providers.
Goods producers added 46,000 jobs and service providers gains were 202,000 jobs. Just a little context here. In 2019, the six months leading, preceding the pandemic, the average monthly job gain was just short of 200,000. Still, there's some signals of strong fundamentals, as we saw yesterday from the BLS JOLTS report. Job openings reached record highs of 11.5 million, and they've been hovering around that level for several months now. That indicates that demand remained ample heading into April. Hiring remains a challenge. We saw a series high of quits at 4.5 million. But we also saw that hires remained greater than separations. People are quitting because they feel like they can get another job, and they're doing so.
Finally, initial claims for unemployment insurance remain at historic lows, so that's a good sign in terms of the relative stability and health of the job gains that we're going to be seeing from for the remainder of the year. Construction. Let's turn actually to giving some industry detail here. We saw that construction payrolls rose by 16,000 in April. This is the weakest gain since August. We know that there's strong demand. Home prices are up by nearly 20% over last year, but that builders can't convert that strong demand so easily into labor supply. And this has been a persistent chronic condition of the housing market for several years. When it comes to natural resources and mining, this industry added 4,000 jobs in April. That's below, slightly below the 5,000 job pace from last year.
Even though oil prices have been over $100 a barrel for the last couple of months, this is not going to provide any long-term benefit for U.S. producers to convert high prices. We don't think that that's going to meaningfully contribute to an acceleration of job gains in that industry. Manufacturing has cooled a little. Additionally, some challenges we see are remaining in this industry. It added 25,000 jobs in April. That's off the pace of 51,000 jobs over the last six months. We've seen that the ISM Manufacturing Index, which is a indicator of the manufacturing health, still remains comfortably above its neutral threshold of 50.
Historically, that's been a sign of continued expansion, though we know that the dynamics in the current labor cycle is led by services rather than manufacturing. We think that manufacturing conditions have softened a bit in the last couple of months due to tightening financial market conditions and some re-intensifying of supply chain stress. We're looking at that market. Now let's switch to payrolls, where job gains rose by 202,000. This is the weakest reading since the recovery began. It's significantly below first quarter average of 447,000. Still, we view this as solid gains continue given where we are in the current cycle. Service industries are facing some difficulty in hiring. It's still a tight labor market when it comes to labor supply.
Travel and tourism, along with food services and some segments of retail, will still be among the slowest to fully recover given the labor shortages, particularly for lower paying industries and occupations. Hiring in professional business services remained pretty solid. Payrolls grew by 50,000 in April. That's down from some of the more impressive gains last year, but still among the strongest in the service industry. Education and healthcare held up pretty well. Gains totaled 48,000 in April. That's only slightly off the 61,000 pace over the last six months, with healthcare still accounting for the majority of those gains. We are seeing some staffing shortages remaining, the biggest challenge in terms of stronger healthcare growth. The recovery in leisure and hospitality also slowed dramatically, and this industry added just 77,000 jobs in April.
By comparison, it had been adding about 200,000 per month over the last 12 months, and we think higher degree demand is strong in this industry. It's really the supply that we're seeing play a bigger role. Then just to round this out, financial services are making solid gains. Remember, this industry was one of the least impacted by the pandemic. It added 8,000 jobs in April. That's only slightly below the gains over the last year. I think interesting in terms of the labor market dynamics at this stage is that the gains are really being driven by larger companies. We saw early on that smaller firms led the charge here, helped a lot by PPP funds that have switched at this stage.
Firms with at least 500 workers were adding 321,000 jobs in April. This is stronger than the average pace of growth over the last year and outpaces other company size segments. Smaller companies with less than 50 employees shed jobs, and some of that could be struggling, but they're struggling the most in the face of inflation and labor shortages. I think the job openings numbers that we saw yesterday actually corroborate the struggle that some of the small firms are having. That 10-49 worker segment, according to the BLS, we saw a drop in those job openings, even though openings reached a record high in total. I think that is illustrative of what we're seeing in our labor market data as well.
Add it all up, you know, we're seeing a labor market that continues to moderate from faster pace last year. That being said, those gains are still solid. It still provides a solid fundamental benchmark for the Fed to continue with its rate hiking policy cycle. The real number to watch in the Friday jobs report, as I think we could all agree, is the wage numbers. That's what we're watching, and to see the impact of wages on that overall inflation profile. With that, I'm now open to your questions.
Thank you, Nela.
If you-
Operator, we are ready for questions.
Sorry about that. If you would like to register a question, please press the one followed by the four on your telephone. You will hear a three-tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw your registration, please press the one followed by the three. Once more, to queue up for a question, it is one followed by the four. Our first question comes from the line of Gregory Robb from MarketWatch. Your line is open.
Hi, good morning. The 247,000 gain in non-farm private employment this month is the smallest since when?
Since before the recovery began, actually.
Do you have the month? I mean, it's like the post-pandemic low kind of thing? Is that another way to say it?
It's not the post-pandemic low, but it is. Actually, I don't have the actual month that was smaller. We saw drops before, but can I follow up with you on that particular month? I don't have that off the top of head.
That'd be great. Thank you so much.
Yeah, sure.
Our next question comes from the line of Anneken Tappe from CNN. Please go ahead.
Hi, Nela. Good morning.
Good morning.
I was wondering if today's report sort of for you means this is the sort of slowdown that you expect to see over the summer months as well as we're running up against the constraint the labor shortage has put on the jobs recovery?
Yeah, I think it's going to be bumpy. I don't think the decline will be in a straight line, so it's not like we're seeing a moderation every single month. I think that as we get some relief on the inflation side, we might see that spill back into some manufacturing hiring, for example. Or we might see a ramp up over the summer months because it's really the leisure and hospitality sector that has the most to gain from a hopefully ebbing pandemic and people ready to travel and do leisure activities again.
It's not like this is what we see as a straight line, but given that the labor market has made such tremendous progress back towards 2019 levels, I think what we're going to see going forward is more of a normal pacing, not, you know, above 500,000 or even, you know, last year we were looking at numbers even close to 1 million. We're not gonna likely see that pace, given the labor shortages. The industries that have most to gain in hiring are also facing the biggest difficulty in terms of offering a wage that's enticing, given the current state of inflation. Inflation has joined labor shortages, is something that could be hampering some further gains.
Kind of turning to the news of the afternoon, I think getting inflation under control will actually help feed that recovery and keep it as robust as possible.
Thank you.
Sure.
As a reminder, to queue up for a question, please press the one followed by the four. There are no further questions at this time. I will now turn the call back to you. Please continue with your presentation or closing remarks.
Thank you, everyone, for joining us this month. We look forward to having you back here for the next report, which will be released on June 2nd. The call is now concluded.
That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines.