A sharp slowdown in the U.S. labor market emerged in November as private employers shed 32,000 jobs, with small businesses bearing the brunt, according to ADP’s payroll data released on Wednesday.
The report suggests the deterioration was larger than many had expected, marking a material step down from October’s revised gain of 47,000 and undershooting economists’ Dow Jones consensus of a 40,000 increase.
By company size, firms with 50 or more employees posted a net hiring gain of 90,000, while those with fewer than 50 workers collectively cut 120,000 positions. Within the smaller category, payrolls for 20–49 employee firms fell by 74,000. Overall, November’s loss represents the largest decline since March 2023.
Sectors with gains included education and health services, which added 33,000 jobs, and leisure and hospitality, up by 13,000. Yet broad-based weakness across many industries pulled the total lower.
The biggest hit came from professional and business services, down 26,000, followed by information services (−20,000), manufacturing (−18,000), and both financial activities and construction (each −9,000).
Wages also cooled, with year-over-year pay growth among those employed at current jobs slowing to 4.4%, down 0.1 percentage point from October.
ADP chief economist Nela Richardson noted that hiring has been volatile, as employers contend with cautious consumer behavior and an uncertain macroeconomic environment. She added that while the November slowdown was broad-based, it was led by a pullback among small businesses.
The ADP figures provide the Fed with the last update on the jobs picture before the central bank’s policy meeting on December 9–10. Market pricing implied roughly an 90% likelihood of another quarter-point rate cut, even as some officials questioned whether additional easing is warranted.
In late December, the Bureau of Labor Statistics will release its assessment of nonfarm payrolls, a report date that had been postponed due to the federal government shutdown.
