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US private employers added fewer positions than anticipated last month, according to the private payroll processor ADP, starting 2026 off on a downbeat note.
Private payrolls grew by just 22,000 in January, ADP said Wednesday, below economists’ expectations of 45,000 positions.
The tally for last year was perhaps an omen.
“Job creation took a step back in 2025, with private employers adding 398,000 jobs, down from 771,000 in 2024,” ADP chief economist Nela Richardson said in a statement. “While we’ve seen a continuous and dramatic slowdown in job creation for the past three years, wage growth has remained stable.”
Manufacturing helped lead the slowdown with a drop of 8,000 jobs in January, according to ADP, less than one year out from President Trump’s sweeping tariffs and promises to restore positions to the sector. Professional and business services also continued to decline, while construction added roles. Losses across the economy would’ve appeared even more stark if not for the healthcare and education sectors posting positive growth, with 74,000 new positions gained in January.
December’s gains were also revised downward, with 37,000 positions added rather than the initially reported 41,000.
This week’s private data releases — ADP with private payroll growth on Wednesday, and the job outplacement firm Challenger, Gray & Christmas with layoffs announcements on Thursday — will be even more closely watched than usual, thanks to the brief, partial government shutdown pushing back the latest official Labor Department data on openings, job growth, and the unemployment rate.
Though the shutdown ended Tuesday, there’s been no word yet on when the all-important government data will be made public.
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To be sure, nothing too major was seen on the horizon: the Chicago Fed saw the unemployment rate holding steady at 4.4%. But any hint of movement in a job market that’s been defined by stagnation could be welcome — or disappointing — news for job-seekers and market-watchers.
Friday’s jobs report was also set to include the Labor Department’s annual benchmark revisions to data for the 12 months through March 2025 to account for state unemployment insurance tax records. The revisions were expected to show that the economy added fewer jobs than initially reported.
Emma Ockerman is a reporter covering the economy and labor for Yahoo Finance. You can reach her at emma.ockerman@yahooinc.com.