A hiring sign is seen in the window of a Manhattan business on November 27, 2025 in New York City.
Spencer Platt | Getty Images
The U.S. labor market slowdown deepened in November as private companies cut 32,000 workers, with small businesses hit hardest, payroll company ADP reported on Wednesday.
Amid growing concerns about the labor market situation at home, ADP indicated that the problems were worse than expected. The drop in jobs marked a sharp decline from October, when the 47,000 job increase was revised upward, and was well below economists’ Dow Jones consensus estimate of a 40,000 job gain.
Larger companies, i.e. companies with 50 or more employees, even reported a net increase of 90,000 employees.
However, businesses with fewer than 50 employees saw a decline of 120,000, including a decline of 74,000 for businesses with 20 to 49 employees. The overall loss was the sharpest decline since March 2023.
Education and health services led the way with 33,000 new hires, while leisure and hospitality added 13,000. But a broad decline across all sectors led to a decline in the overall number.
The biggest loss was in professional and business services, which saw a decline of 26,000. Other job losses included information services (-20,000), manufacturing (-18,000) and finance and construction, where 9,000 jobs were lost each.
Wages also slowed, with workers keeping their jobs rising 4.4% year-over-year, down 0.1 percentage points from October.
“Recruitment has been choppy recently as employers contend with cautious consumers and uncertainty
“We have strengthened the macroeconomic environment,” said Nela Richardson, chief economist at ADP. “And while the slowdown in November was broad-based, it was driven by a decline in small businesses.”
The ADP report is the final jobs picture the Federal Reserve receives before it meets on December 9th and 10th. Futures traders believe there is almost a 90% chance the central bank will approve another quarter-percentage point cut in its key interest rate, although some officials have concerns about whether further easing is needed. After the ADP release, the probability was about the same.
In recent weeks, Fed policymakers have expressed varying opinions. One side believes cuts are necessary to prevent further labor market problems, while the other fears that additional cuts could fuel inflation, which is well above the Fed’s 2 percent target.
The Bureau of Labor Statistics will release its estimate of nonfarm payrolls on Dec. 16, a date that has been delayed due to the government shutdown.
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