Small businesses shed 120K jobs in November, ADP data shows

Small businesses ADP’s latest private sector jobs report showed more than 100,000 jobs were lost in November amid economic uncertainty.

ADP’s November employment report revealed that private sector companies cut 32,000 jobs in November overall. This decline was led by small companies, which… Loss of 120 thousand jobs In November, while medium-sized companies (ranging from 50 to 499 employees) added 51,000 jobs, large enterprises added 39,000 jobs to offset some of the monthly decline.

Hiring “has been volatile recently as employers grapple with cautious consumers and an uncertain macroeconomic environment,” noted Nella Richardson, chief economist at ADP, adding that while “the slowdown in November was broad-based, it was driven by withdrawal among small businesses.”

Small businesses are facing uncertainty about the economy, which has shown signs of a slowing labor market and persistent inflation even though economic growth data remains resilient amid the artificial intelligence boom. Unlike larger companies, small businesses are particularly sensitive to changing economic trends and policy shifts such as rising tariffs.

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Small businesses lost 120,000 jobs in November, according to the ADP employment report. (James Carbone/Newsday RM via Getty Images)

“It seems to be a classic case of the canary in the coal mine scenario,” Sean Higgins, a research fellow at the Competitive Enterprise Institute, told FOX Business. “There are a lot of Economic uncertainty “Right now because of the tariffs and other things, small businesses are having a hard time weathering that, waiting for things to work out.”

“I think a big part of this is Tariff status. We’ve had this year where rates in various countries have continued to fluctuate and change by about a cent and quickly. “Businesses don’t like tariffs, but they don’t like uncertainty any more, so they’re trying to figure out what prices will be in the next six months to a year,” he said.

The ADP report showed declines among industries producing goods and providing services. In the services sector, professional and business services lost 26,000 jobs, information services lost 20,000 jobs, while education and health care added 33,000 jobs.

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Tariffs are taxes on imported goods, paid by importers who often pass on higher costs to consumers through higher prices. (Brandon Bell/Getty Images)

Among the industries that produce goods, Manufacturing companies 18,000 jobs were lost and construction 9,000 – while natural resources and mining companies added 8,000 jobs.

Manufacturers face tariffs through higher costs on intermediate goods that they use to produce finished goods that are sold either in the United States or in the United States. Exported to foreign markets.

“The assumption in most definitions is that they are finished products, which is what most people think of, and therefore, if you prevent those finished products from entering the United States, people will buy those products from producers here in the United States,” Higgins said. “The problem is that’s not really the case. A lot of times it has to do with the raw materials coming in and that’s what manufacturers use.”

He referred to steel definitions from the beginning Trump term For example, because it boosted employment in steel production roles, but as a result it hurt employment at other manufacturing facilities that depend on imported steel.

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Small business owners faced uncertainty throughout 2025 amid tariff changes and other policy changes. (Istock)

Peter Hansen, director of research and policy analysis at the National Federation of Independent Business (NFIB), told FOX Business that his data contradicts the ADP and notes that while Labor market It has cooled, it is still in positive territory.

Hansen noted that the trade group, which represents small and independent businesses, has seen small businesses trying to hire struggle to find suitable workers.

He added that uncertainty has created challenges for small businesses throughout the year, with uncertainty mounting around periods of major transition such as the president’s tariff announcements in April.

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“It’s not just a company that’s unsure about its future and then a little hesitant to invest. I think it’s a company that sells to people who are a little unsure,” Hansen said.