U.S. Private-Sector Firms Eliminated 84000 Jobs in December

The U.S. economy got some very good and surprising news this morning. According to today’s ADP National Employment Report, private-sector firms in the U.S. eliminated 84,000 jobs in December. As bad as an 84K job loss is, that’s the smallest monthly decline since March 2008. The number was slightly worse than the 75,000 job losses that economists were looking for, but was considerably better than the loss of 145,000 jobs reported for November. Employment losses are now rapidly diminishing as the world’s largest economy begins recovering from the worst recession since the 1930s. If recent trends continue, private employment will begin rising by first quarter of 2010.

Below is ADP’s release in full:

ADP: “[P]rivate sector employment decreased by 84,000 in December. The ADP National Employment Report, created by Automatic Data Processing, Inc. (ADP®), in partnership with Macroeconomic Advisers, LLC, is derived from actual payroll data and measures the change in total nonfarm private employment each month.

Nonfarm Private Employment Highlights — December Report:

  • Total employment: -84,000
  • Small businesses* -25,000
  • Medium businesses** -25,000
  • Large businesses*** -34,000
  • Goods-producing sector: -96,000
  • Service-providing sector: +12,000


  • Manufacturing industry: -43,000

* Small businesses represent payrolls with 1-49 employees
** Medium businesses represent payrolls with 50-499 employees
*** Large businesses represent payrolls with more than 499 employees

According to Joel Prakken, Chairman of Macroeconomic Advisers, LLC, “Nonfarm private employment decreased 84,000 from November to December 2009 on a seasonally adjusted basis, according to the ADP National Employment Report. The December employment decline was the smallest since March of 2008. Employment losses are now rapidly diminishing and, if recent trends continue, private employment will begin rising within the next few months.”

Prakken added, “December’s ADP Report estimates nonfarm private employment in the service-providing sector increased by 12,000, the largest increase since January of 2008. However, this employment growth was not enough to offset continued losses in the goods-producing sector. Employment in the goods-producing sector declined 96,000, with employment in the manufacturing sector dropping 43,000.”

“Large businesses, defined as those with 500 or more workers, saw employment decline by 34,000, while medium-size businesses with between 50 and 499 workers declined 25,000. Employment among small-size businesses, defined as those with fewer than 50 workers, declined 25,000,” said Prakken.

Prakken went on to say, “In December, construction employment dropped 52,000. This was its thirty-fifth consecutive monthly decline, and brings the total decline in construction jobs since the peak in January 2007 to 1,777,000. Employment in the financial services sector dropped 12,000.”

The matched sample used to develop the ADP National Employment Report was derived from ADP data, which during the twelve month period through December 2009, averaged over 360,000 U.S. business clients and represented over 22 million U.S. employees. This approximately represents the size of the matched sample used this month.

Small Business Highlights — December Report:

Due to the important contribution small businesses make to economic growth, employment data that is specific to businesses with fewer than 50 employees will be reported in the ADP Small Business Report® each month. The ADP Small Business Report is a subset of the ADP National Employment Report.

  • Total small business employment: -25,000
  • Goods-producing sector: -36,000 small business jobs
  • Service-providing sector: +11,000 small business jobs

Private employment among small businesses decreased by 25,000 in December, according to the ADP Small Business Report released today. Additional information about small business employment, including charts on monthly job growth and employment levels, along with historical data, is available at http://www.smallbusinessreport.adp.com.

“Employment among small-size businesses, defined as those with fewer than 50 workers, declined 25,000 in December. However, small business employment within the service-providing sector increased by 11,000 during December. If recent trends continue, private employment will begin rising within the next few months,” said Joel Prakken.”

The ADP report is based on data from about 360,000 businesses with about 22 million workers on payrolls.

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