ADP Says Private Employers Cut 32,000 Jobs in November, Led by Small Firms

Private employers in the United States cut about 32,000 jobs in November, payroll processor ADP said on Wednesday, well below economists’ expectation of a gain of 10,000. Reuters reported that the decline was the steepest since March 2023. October’s gain was revised up to 47,000 from 42,000.

Small businesses accounted for the loss. Establishments with fewer than 50 employees cut 120,000 jobs, while firms with 50 to 499 workers added 51,000 and those with 500 or more added 39,000, according to the report. ADP’s Nela Richardson said the slowdown was broad-based but “led by a pullback among small businesses,” and said hiring “has been choppy of late as employers weather cautious consumers.”

By sector, education and health services added 33,000 jobs, leisure and hospitality 13,000, natural resources and mining 8,000, and trade, transportation and utilities 1,000. Professional and business services lost 26,000, information 20,000, manufacturing 18,000, construction and financial activities 9,000 each, and other services 4,000. Pay growth cooled slightly: workers who stayed in their jobs saw a 4.4 percent year-over-year raise, down from 4.5 percent, while those who changed jobs got 6.3 percent, down from 6.7 percent.

Heather Long, an economist at Navy Federal Credit Union, described what she called a “start-to-fire job market” and said, “This is no longer a low hiring job market, it’s a start-to-fire job market,” and expects it to persist into the first half of 2026, according to the Fox 9 report. Reuters said economists attributed the small-firm losses to tariffs on imports.

Other economists urged caution. Samuel Tombs of Pantheon Macroeconomics said, as Reuters reported, that the ADP data are “too loosely correlated with the official data to be troubling,” and said his model points to a first estimate of 75,000 to 100,000 private payroll gains in the government’s November report. Some economists noted that surveys from the NFIB, the Conference Board and regional Federal Reserve banks show softer hiring, but not the deterioration ADP suggests.

The government’s own numbers are delayed. The Labor Department’s November jobs report, originally due Dec. 5, was pushed back by the recent government shutdown and is now scheduled for Dec. 16, and it will include October payrolls, according to the Fox 9 report. The October unemployment rate will never be published because the shutdown prevented collection of the household survey data used to calculate it, according to the Fox 9 report. In September, the economy added 119,000 jobs and the jobless rate rose to a four-year high of 4.4 percent, Reuters noted, and Reuters said applications for state unemployment benefits were consistent with a “no-hire, no-fire” labor market.

Reuters said some economists could pay more attention to the ADP report than usual. Sal Guatieri of BMO Capital Markets said the report might be all the more dovish-leaning Fed governors need to push through another rate cut.