ADP shows another month of lost jobs, with small firms getting hammered

Even though the government's job numbers have been delayed and have yet to catch up from October's and November's shutdown, the ADP company has continued to release their monthly jobs numbers. And today's November report from ADP showed some surprisingly bad news.

The U.S. labor market slowdown intensified in November as private companies cut 32,000 workers, with small businesses hit the hardest, payrolls processing firm ADP reported Wednesday.

With worries intensifying over the domestic jobs picture, ADP indicated the issues were worse than anticipated. The payrolls decline marked a sharp step down from October, which saw an upwardly revised gain of 47,000 positions, and was well below the Dow Jones consensus estimate from economists for an increase of 40,000….

Education and health services led gainers with 33,000 hires, while leisure and hospitality added 13,000. But a broad-based decline across industries drove the total lower.

The biggest loss came in professional and business services, which saw a decline of 26,000. Others shedding jobs included information services (-20,000), manufacturing (-18,000), and financial activities and construction, both of which saw losses of 9,000.

The rate of pay also slowed, with workers staying in their jobs seeing a 4.4% year-over-year increase, down 0.1 percentage point from October.

As UW-Madison’s Menzie Chinn notes in Econbrowser, ADP’s reports indicate that private sector job growth has basically flatlined in the 2nd half of 2025, and declined in 4 of the last 7 months.

Chinn also splits up ADP’s breakdown of employment changes between larger and smaller private sector employers. And like a lot of things in our economy these days, it shows serious bifurcation.

Notice that decline in small employers? That includes a net loss of 69,000 in November, and even that is deceptive, as ADP says the smallest employers got especially wrecked last month.

And ADP reports that around 43.5% of Americans work for businesses that have less than 50 employers. So a lot of us are in sectors and small businesses that are basically in recession over the last few months. You wonder why consumer sentiment sucks so much these days?

Naturally this meant that the stock market went up, because bad news in the real economy is good news for Wall Street greedheads and others strung out on debt.

The Dow Jones Industrial Average gained 408.44 points, or 0.86%, to finish at 47,882.90. The S&P 500 traded up 0.30% to end the day at 6,849.72, while the Nasdaq Composite added 0.17% to settle at 23,454.09.

Payrolls processor ADP reported that private payrolls surprisingly declined by 32,000 in November. Economists polled by Dow Jones had expected an increase of 40,000 for the month. Despite the tough reading, traders were likely betting that the private job losses will lead the Fed to slash rates at its last meeting of the year on Dec. 10.

“The labor market, that’s what people are going to focus on,” Scott Welch, Certuity’s chief investment officer, said in an interview with CNBC. “The numbers will come in as they come in, and it’ll either lead toward a cut or not, but I suspect that there’s no question there will be a cut next week.”

Markets are pricing in an 89% chance of a cut next Wednesday, which is much higher than the odds from mid-November, according to the CME FedWatch tool. Investors anticipate that a lower rate environment will spur loan growth and give a jolt to the U.S. economy, leading shares of key financial stocks like Wells Fargo and American Express higher Wednesday.

“The market is hinged on the Fed, and so if they don’t cut, it’s not going to turn out well,” Welch added.

Oh, so the only way out of a debt-fueled Bubble of empty promises is to get lower interest rates so already-tapped consumers with dimmer job prospects might borrow more money that they don't have. With many having big increases in health care premiums set to hit in a month.

Cool way to have an economy, isn't it? No flaws with this AT ALL!