Employment at US companies picked up in January by more than forecast, highlighting resilient job growth despite mounting uncertainty.

Private payrolls rose by 183,000 last month following an upwardly revised 176,000 increase in December, according to ADP Research Institute data. The median projection in a Bloomberg survey of economists called for a 150,000 increase.

Wednesday’s report reaffirms the labor market is still expanding at a healthy pace, with the six-month average increase in payrolls accelerating to the fastest pace since early 2023. While a decline in vacancies and easing wage growth suggest some moderation is underway, employers are still hiring and layoffs remain subdued.

Federal Reserve officials are closely tracking developments in the labor market as they assess how much to lower interest rates this year. A rapid pickup in the unemployment rate last summer was a key driver behind policymakers’ decision to lower rates by a full percentage point in 2024. That said, the job market has showed renewed strength since then, with Fed Chair Jerome Powell describing it last week as “pretty stable.”

“We had a strong start to 2025 but it masked a dichotomy in the labor market,” said Nela Richardson, chief economist at ADP. “Consumer-facing industries drove hiring, while job growth was weaker in business services and production.”

Job growth was concentrated in the service sector, led by trade and transportation and leisure and hospitality industries. Within goods-producing industries, construction and mining employment also rose, while manufacturing employment declined.

The ADP report, published in collaboration with Stanford Digital Economy Lab, showed stable wage growth. Workers who changed jobs saw a 6.8% pay increase in January from a year earlier, and those who stayed put saw a 4.7% increase.

The government’s monthly employment report due Friday is projected to show private payrolls rose by 150,000 in January.

ADP bases its findings on payrolls covering more than 25 million US private-sector employees.

(With assistance from Chris Middleton.)