Private Sector Job Creation in December
Private sector employment increased by 41,000 in December, according to a report released by payrolls processing firm ADP on Wednesday. This follows a revised loss of 29,000 jobs in November. The December increase was below the Dow Jones consensus estimate of 48,000 new jobs.
Sectoral Breakdown
Job growth was concentrated in the services sector.
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Services Sector Gains:
- Education and Health Services: +39,000 jobs
- Leisure and Hospitality: +24,000 jobs
- Trade, Transportation, and Utilities: +11,000 jobs
- Financial Services: +6,000 jobs
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Sectoral Declines:
- Professional and Business Services: -29,000 jobs
- Information Services: -12,000 jobs
- Goods-producing industries: -3,000 jobs, primarily due to a 5,000 job reduction in manufacturing.
Company Size and Wages
Most job gains occurred in companies with fewer than 500 employees. Larger firms contributed 2,000 new jobs.
Nela Richardson, ADP's chief economist, stated, "Small establishments recovered from November job losses with positive end-of-year hiring, even as large employers pulled back."
Wage growth showed an average annual increase of 4.4% for employees remaining in their positions, consistent with November figures. Job changers experienced a 6.6% increase, a 0.3 percentage point rise from the previous month.
Upcoming BLS Report
This ADP report precedes the Bureau of Labor Statistics' (BLS) nonfarm payrolls count, scheduled for release two days later. BLS data collection had previously been affected by a government shutdown. Economists surveyed by Dow Jones project 73,000 new jobs for the month and anticipate the unemployment rate to decrease to 4.5%.