Private sector employment increased by 22,000 jobs in January and pay was up 4.5% year-over-year according to the January ADP National Employment Report produced by ADP Research in collaboration with the Stanford Digital Economy Lab.
The total was less than the downwardly revised 37,000 increase in December and below the Dow Jones consensus forecast for 45,000.
The ADP National Employment Report is an independent measure of the labor market based on the anonymized weekly payroll data of more than 26 million private-sector employees in the United States. ADP’s Pay Insights captures over 15 million individual pay change observations each month. Together, the jobs report and pay insights use ADP’s data to provide a picture of the private-sector labor market.
“Job creation took a step back in 2025, with private employers adding 398,000 jobs, down from 771,000 in 2024,” said Dr. Nela Richardson, chief economist, ADP. “While we’ve seen a continuous and dramatic slowdown in job creation for the past three years, wage growth has remained stable.”
In a lackluster month for hiring, the education and health services sector was a standout, adding 74,000 jobs. Leading the slowdown was manufacturing, which has lost jobs every month since March 2024, professional and business services, and large employers. Professional/business services shed 57,000 jobs.
The Midwest led job growth with 25,000 jobs. The Northeast added 17,000. The West and the South regions of the nation lost 11,000 and 10,000 jobs, respectively.Â
The ADP report usually precedes the Bureau of Labor Statistics nonfarm payrolls report, which normally would be out Friday. However, the partial government shutdown is again delaying the BLS release. Unlike the ADP report, the BLS data includes government jobs. Both total nonfarm payroll employment (+50,000) and the unemployment rate (4.4%) changed little in December, the U.S. Bureau of Labor Statistics reported on Jan. 9.
