U.S. Private Sector Adds 41,000 Jobs in December, Below Expectations

The U.S. private sector added 41,000 jobs in December, according to the latest ADP National Employment Report. This marks a reversal from the loss of 29,000 jobs in November but falls short of the anticipated 48,000 new positions.

Job gains were concentrated in service-providing industries. Education and health services led with 39,000 new positions, while leisure and hospitality added 24,000 jobs. Trade, transportation, and utilities saw an increase of 11,000 jobs, and financial activities added 6,000.

Conversely, professional and business services experienced a decline of 29,000 jobs, and the information sector lost 12,000 positions. Goods-producing industries collectively shed 3,000 jobs, primarily due to a 5,000-job decrease in manufacturing.

Small businesses, defined as those with fewer than 50 employees, added 9,000 jobs, recovering from November's losses. Medium-sized companies contributed 34,000 jobs, while large firms added just 2,000 positions.

ADP's Chief Economist, Nela Richardson, noted, "Small establishments recovered from November job losses with positive end-of-year hiring, even as large employers pulled back."

Wage growth remained steady. Employees who stayed in their jobs saw an average annual pay increase of 4.4%, consistent with November's figures. Those who changed jobs experienced a 6.6% increase, up 0.3 percentage points from the previous month.

These figures precede the upcoming nonfarm payrolls report from the Bureau of Labor Statistics, which is expected to show an increase of 73,000 jobs for December and a slight decrease in the unemployment rate to 4.5%.