WASHINGTON (Reuters) -U.S. private payrolls increased less than expected in August amid easing labor market conditions.

Private employment rose by 54,000 jobs last month after a slightly upwardly revised 106,000 increase in July, the ADP National Employment Report showed on Thursday. Economists polled by Reuters had forecast private employment increasing 65,000 following a previously reported 104,000 gain in July.

The ADP report, jointly developed with the Stanford Digital Economy Lab, was published ahead of the more comprehensive employment report for August due to be released on Friday by the Labor Department's Bureau of Labor Statistics. There is no correlation between the ADP and BLS employment reports.

The labor market is softening, with economists blaming President Donald Trump's sweeping import tariffs and an immigration crackdown that has hampered hiring at construction sites and restaurants.

A separate report from global outplacement firm Challenger, Gray and Christmas showed layoffs announced by U.S.-based employers jumped 39% to 85,979 in August. That was the highest total for August since 2020.

The government reported on Wednesday that there were more unemployed people than positions available in July for the first time since the COVID-19 pandemic. The Federal Reserve's "Beige Book" report on Wednesday also noted that "firms were hesitant to hire workers because of weaker demand or uncertainty."

A Reuters survey of economists expects the government's closely watched employment report on Friday will likely show nonfarm payrolls increased by 75,000 jobs in August after rising by 73,000 in July. Employment gains averaged 35,000 jobs per month over the last three months compared to 123,000 during the same period in 2024, the government reported in August.

The unemployment rate is forecast to climb to 4.3% from 4.2% in July. Federal Reserve Chair Jerome Powell last month signaled a possible rate cut at the U.S. central bank's September 16-17 policy meeting, acknowledging the rising labor market risks, but also added that inflation remained a threat. 

The Fed has kept its benchmark overnight interest rate in the 4.25%-4.50% range since December.