Topline

The U.S. private sector shed more than 11,000 jobs per week on average through late October, according to data released Tuesday by the private payroll processing firm ADP, as economists have projected a historic decline in the job market in recent weeks.

Earlier data indicated private-sector payrolls increased in October after declining in the two previous months.

Copyright 2023 The Associated Press. All rights reserved.Key Facts

Private-sector employers shed an average of 11,250 jobs per week in the four weeks ending Oct. 25, suggesting the “labor market struggled to produce jobs consistently during the second half of the month,” ADP reported, noting the data was preliminary and could change as new information is added.

The decline is the first recorded by ADP since August, when an average of nearly 20,000 jobs were lost in four weeks ending Aug. 30, according to ADP’s data.

Earlier in the month, the job market seemed promising, with ADP reporting last week that private-sector payrolls increased by 42,000 in October, ahead of Wall Street’s estimates for an added 37,500 jobs, according to FactSet, while marking a rebound from the 29,000 jobs shed in September.

But ADP’s latest data suggests private-sector payrolls declined sharply in late October: The firm reported last month that private employers added an average of 14,250 jobs per week in the four weeks ending Oct. 11.

Goldman Sachs, Indeed, More Project A Worsening Job Market

Analysts at Goldman Sachs wrote on Monday the number of U.S. nonfarm payrolls—a measurement of public and private employment—likely declined by 50,000 in October, marking what would be the largest single-month decline since late 2020. Economists surveyed by Dow Jones expected a steeper decline in October, with estimates of 60,000 jobs shed and a projected increase in the unemployment rate to 4.5%. Indeed, which tracks employment opportunities across its jobs site, reported job openings fell to their lowest level since February 2021. The most recent available data from the Bureau of Labor Statistics, which has delayed the release of its employment and inflation reports during the government shutdown, showed the economy added 22,000 nonfarm jobs in August as unemployment rose to 4.3%.

Surprising Fact

More than 1 million jobs have been cut so far this year, up 65% from the more than 664,000 announced over the same period last year, according to the career services firm Challenger, Gray & Christmas. The government remains the sector with the most cuts after reporting more than 300,000 job losses, followed by the technology, warehousing, retail and service sectors. Job cuts have surpassed 1 million in a year only four other times in the last 32 years, according to Challenger, Gray & Christmas, including 2001 when the dot-com bubble burst, 2008 and 2009 during the Great Recession and in 2020, when the COVID pandemic struck.

Key Background

ADP, whose monthly private hiring data is widely tracked, announced it would also release weekly employment data to provide an “even clearer picture of the labor market at this critical time for the economy.” The firm’s employment report remains one of the few available measurements of the U.S. job market during the government shutdown, as several companies—including Amazon, Starbucks, Target and UPS—have announced large-scale layoffs in recent weeks. Americans have expressed growing concerns about job prospects, according to the University of Michigan’s consumer sentiment survey, which last week reported 71% of respondents expected unemployment to rise over the next year, the largest share since 1980.

Further ReadingForbesMore Than 1 Million Jobs Have Been Cut This Year, Report SaysBy Mary Whitfill RoeloffsForbesU.S. Private Sector Added 42,000 Jobs Last Month—More Than ExpectedBy Ty Roush