Private payrolls unexpectedly fell by 32,000
A hiring sign is displayed in the window of a Manhattan business on November 27, 2025 in New York City.
Spencer Platt | Getty Images
The slowdown in the U.S. labor market intensified in November as private companies laid off 32,000 workers, with small businesses the hardest hit, payroll processing company ADP reported Wednesday.
As concerns about the domestic employment picture intensify, ADP said the problems were worse than expected. The decline in jobs was a sharp decline from October, which saw an upwardly revised 47,000 job gain, well below economists’ Dow Jones consensus forecast of a 40,000 gain.
Larger businesses, which include companies with 50 or more employees, actually reported net earnings of 90,000 workers.
But businesses with fewer than 50 employees saw a decrease of 120,000; this included a drop of 74,000 at companies with 20 to 49 employees. The total loss was the largest decline since March 2023.
Education and health services were the top earners with 33,000 hires, while entertainment and accommodation services hired 13,000 people. But the broad-based decline across sectors caused the total to fall further.
The biggest loss was in professional and business services, down 26,000. Others with job losses included information services (-20,000), manufacturing (-18,000), and financial activities and construction; There were 9,000 casualties in both.
Wage rates have also slowed; Workers remaining in their jobs recorded an annual increase of 4.4%, down 0.1 points from October.
“Hiring has been volatile lately as employers weather cautious consumers and uncertainty
“The macroeconomic environment,” said Nela Richardson, ADP’s chief economist, “while November’s slowdown was broad-based, it was driven by a decline among small businesses.”
The ADP report is the Federal Reserve’s last business picture before its December 9-10 meeting. Futures traders have an almost 90% chance that the central bank will approve another quarter-point cut in the interest rate, despite doubts from some officials about whether further easing is needed. The odds were about the same after the ADP announcement.
In recent weeks, Fed policymakers have expressed disagreement. While one side thinks the cuts are necessary to prevent further labor market distress, the other side worries that additional cuts could worsen inflation, which is running well above the Fed’s 2% target.
The Bureau of Labor Statistics will release its assessment of the nonfarm payrolls picture on Dec. 16, a date delayed by the government shutdown.
