ADP: Small Businesses Gain 121K Jobs in April

adp national employment report april 2023

Strong hiring, along with a deceleration in pay growth, contributed to a private sector “burst of hiring” increase of 296,000 jobs in April, according to the ADP National Employment Report.

The largest decrease in jobs was in manufacturing, where 38,000 jobs were lost.

Small businesses contributed 121,000 of the job gains. The majority of the gains were in small businesses with 20-49 employees, with 107,000 new jobs. Businesses with 1-19 employees grew by 14,000 jobs.

The report is produced by the ADP Research Institute® in collaboration with the Stanford Digital Economy Lab (“Stanford Lab”).

Pay Growth Slows

“The slowdown in pay growth gives the clearest signal of what’s going on in the labor market right now,” said Nela Richardson, chief economist, ADP. “Employers are hiring aggressively while holding pay gains in check as workers come off the sidelines. Our data also shows fewer people are switching jobs.”

Strong hiring, coupled with a deceleration in pay growth, creates “everything you could want in a labor market,” Richardson said.

Richardson said that pay rates are “the strongest signal of what’s going on” in the economy. She added that the deceleration in pay growth is broad based and is the clearest signal that the job market is tightening.

Pay gains slowed rapidly in April, she said.

“Pay growth continued its nearly year-long slowdown,” Richardson said. “Job changers in particular saw a dramatic decline, with pay slowing from 14.2 percent growth to 13.2 percent, the slowest pace of growth since November 2021.”

Median Change in Annual Pay for Job-Stayers by Firm Size

Small firms:

  • 1-19 employees: 5.5%
  • 20-49 employees: 6.7%

Medium firms:

  • 50-249 employees: 6.9%
  • 250-499 employees: 6.8%

Large firms:

  • 500+ employees: 6.8%

Bulk of Growth in Service Sector

By industry sector, service providing jobs grew by 229,000. The bulk of those gains, 154,000, were in leisure and hospitality.

Goods producing jobs grew by 67,000. Richardson noted that while there were 38,000 jobs lost in manufacturing, construction (gain of 53,000) and natural resources/mining (gain of 52,000) saw strong growth.

She noted that new home construction has been increasing in recent months.

Breakdown of service-providing jobs:

  • Trade/transportation/utilities 32,000
  • Information 2,000
  • Financial activities -28,000
  • Professional/business services -16,000
  • Education/health services 69,000
  • Leisure/hospitality 154,000
  • Other services 16,000

Change by Establishment Size

Small businesses and medium businesses experienced nearly matching gains in job growth. Small businesses gained 121,000 jobs, and medium businesses gained 122,000 jobs. Large firms (greater than 500 employees) gained 47,000 jobs.


Image: Depositphotos

Lisa Price Lisa Price is a staff writer for Small Business Trends and has been a member of the team for 4 years. She has a B.A. in English with a minor in journalism from Shippensburg State College (Pennsylvania). She is also a freelance writer and previously worked as a newspaper circulation district manager and radio station commercial writer. In 2019, Lisa received the (Pennsylvania) Keystone Award.