Small businesses fueled job growth in November
Small U.S. businesses added more than 100,000 jobs to their payrolls last month, adding almost half of the total gains notched by the private sector.
Private-sector payrolls in the U.S. climbed by 208,000 in November, according to a report by payroll processor Automatic Data Processing and analysis provider Moody’s Analytics. Still, the results were a bit disappointing, as observers had projected a 225,000 increase in jobs.
The gain was driven by a leap in hiring at small businesses, which ADP defines as companies with 49 or fewer employees. Payrolls for those businesses increased 101,000 in November, down 2,000 from October. Medium- and large-sized businesses also added jobs last month.
“Steady as she goes in the job market,” said Mark Zandi, chief economist of Moody’s Analytics. “The tightening in the job market will soon prompt acceleration in wage growth.”
By sector, the trade/transportation/utilities businesses added the most jobs last month. Professional/business services also boosted hiring significantly, while gains were more modest for the construction, manufacturing and financial activities industries.
The labor market has performed well of late, bolstered by U.S. economic growth that has encouraged employers to add jobs at a steady and consistent pace. The gains in jobs have been fairly broad-based in nature, though wages haven’t budged much.
The ADP report was issued two days before the federal government’s monthly jobs report, which includes the unemployment rate. Economists predict that report to show U.S. hiring increased by 230,000 in November, while the nation’s unemployment rate is expected to remain unchanged at 5.8%.