ADP National Employment Report: 103K Private Jobs Added in November

by Jennifer Nash, 12/6/23

The economic mover and shaker this week is Friday's employment report from the Bureau of Labor Statistics. This monthly report contains a wealth of data for economists, the most publicized being the month-over-month change in Total Nonfarm Employment (the PAYEMS series in the FRED repository). However, each month a few days before we receive the highly anticipated jobs report, ADP releases their data on new nonfarm private jobs.

The ADP employment report showed that 103K nonfarm private jobs were added in November, a slight slow down from the 106K private jobs added in October. The latest figure is lower than the expected 130K new private jobs and is the second smallest monthly increase since January 2021.

The forecast for the forthcoming BLS report is that 155,000 private nonfarm jobs were added in November. However, the forecast for the full nonfarm jobs (the PAYEMS number) is for 180,000 jobs to have been added. Here is a visualization of the two series over the past twelve months.

Here is an excerpt from today's ADP report press release:

“Restaurants and hotels were the biggest job creators during the post-pandemic recovery,” said Nela Richardson, chief economist, ADP. “But that boost is behind us, and the return to trend in leisure and hospitality suggests the economy as a whole will see more moderate hiring and wage growth in 2024.”

Here is a snapshot of the monthly change in the ADP headline number since the company's earliest published data with the new methodology in 2010. This is quite a volatile series, so we've plotted the monthly data points as dots along with a six-month moving average, which gives us a clearer sense of the trend. The latest six-month moving average is 208,000, down from last month's 235,000.

As we see in the chart above, the trend peaked in September 2015 and then went negative for the first time in late 2019, just before the NBER declared a recession start. The COVID-19 pandemic has brought employment numbers down to levels we have never seen this century. The trend reached a new high in 2021 at 778,000 and has recently dropped back to pre-pandemic levels.

ADP Employment: Industry

ADP also gives us a breakdown of Total Nonfarm Private Employment into two categories: Goods Producing and Service Providing. The US is predominantly a services economy, so it comes as no surprise that Services employment has shown stronger jobs growth. It makes sense that service-producing employment has plummeted during the pandemic for a couple of reasons - our economy is mostly supported by service-producing jobs, and during the pandemic, those same services were brought to a halt. In November, goods-producing jobs declined by 14,000 while service-providing jobs added 117,000.

The sector with the largest growth in November was Trade, Transportation, and Utilities with a gain of 55,000 private jobs. The biggest losers this month were Manufacturing (-15,000) and Leisure and Hospitality (-7,000).

Here is the same chart style (as the one above) illustrating the two.

For a better sense of the components of the two Goods Producing and Service Providing cohorts, here is a year-over-year comparison snapshot of the select industries tracked by ADP making up the two groups.

ADP Nonfarm Private Employment Goods YoY

ADP Nonfarm Private Employment Services YoY

The next chart is a linear representation of each industry's contribution to overall employment from the start of the series.

ADP Employment: Region

ADP also gives us a breakdown of Total Nonfarm Private Employment into nine regions (census divisions). The region with the largest growth in November was the Mid-Atlantic, with a gain of 52,000 private jobs, while the biggest loser was the East South Central region, with a loss of 10,000 private jobs.

Here is a year-over-year comparison snapshot of the select census divisions tracked by ADP.

The next chart is a linear representation of each region's contribution to overall employment from the start of the series.

ADP Employment: Establishment Size

ADP also gives us a breakdown of Total Nonfarm Private Employment into five sizes. Establishments with 50-249 employees saw the largest growth in November with a gain of 71,000 private jobs while those with 20-49 employees experienced the biggest loss of 16,000 private jobs.