Small businesses had a great month in December, gaining 195,00 jobs, according to the ADP Research Center’s national employment report, calculated in conjunction with the Stanford Digital Economy Lab.
Counting businesses of all sizes (small, medium and large) there were 235,000 jobs gained nationally during December. Small businesses (195,000 gain) and medium businesses (191,000 gain) pulled up the average, while large businesses of more than 500 employees lost 151,000 jobs.
ADP Chief Economist Nela Richardson called the labor market “strong but fragmented.” She said that job gains and losses varied significantly by industry and size.
ADP Small Business Jobs Report
Small businesses with 1-19 employees gained 65,000 jobs during December. Small businesses of 20-49 employees gained 130,000 jobs.
Nationally, including businesses of all sizes, people who stayed in the same job saw a pay increase over the year of 7.3%. Job stayers in small businesses of 20-49 employees saw a pay increase of 6.9%, while those working in businesses of 1-19 employees saw a pay increase of 5.4%.
The annual pay increase is calculated based on the pay/salary amount for the same month during the preceding year. The numbers are crunched using the payroll transactions of more than 25 million workers.
Which Industries Saw the Most Growth?
Nationally, amongst businesses of all sizes, the industry with the biggest gain was Leisure and Hospitality, which gained 123,000 jobs. Leisure and Hospitality also saw the biggest annual pay increase, 10.1%.
Other industries with strong growth were:
- Professional and Business Services: 52,000 jobs
- Education and Health Services: 42,000 jobs
- Construction: 41,000 jobs
Industries which was a reduction in jobs were Trades, Transportation and Utilities, a decrease of 24,000 jobs, and Financial Activities, a decrease of 12,000 jobs.
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And somehow this confirms to the Fed that interest rates still aren’t high enough.