US firms add 235,000 jobs, more than forecast

US COMPANIES added more jobs than expected in December, driven by small- and medium-sized businesses, and highlighting the resilience of labour demand that is underpinning wage growth. 

Private payrolls increased 235,000 last month after an upwardly revised 182,000 in November, according to data from ADP Research Institute in collaboration with Stanford Digital Economy Lab. The median forecast in a Bloomberg survey of economists called for a 150,000 advance.

Job gains were concentrated in businesses with less than 500 employees. The largest companies cut 151,000 workers from payrolls, ADP said. Leisure and hospitality, education and health services, professional and business services and construction led jobs growth.

“The labour market is strong but fragmented, with hiring varying sharply by industry and establishment size,” Nela Richardson, chief economist at ADP, said on Thursday (Jan 5) in a statement. “Business segments that hired aggressively in the first half of 2022 have slowed hiring and in some cases cut jobs in the last month of the year.”

The figures suggest the labour market, while cooling in certain pockets, remains strong. Despite concerns of a looming recession, labour demand still far outstrips supply, keeping upward pressure on wages and giving consumers the wherewithal to keep spending. Lay-offs also remain extremely low and openings are elevated. BLOOMBERG