Here’s a startling fact: despite economic uncertainties, the U.S. private sector added 41,000 jobs in December 2025, with annual pay rising by 4.4%, according to the latest ADP National Employment Report®. But here’s where it gets controversial—while small businesses rebounded from November’s losses, large employers scaled back hiring. Could this signal a shift in the labor market’s power dynamics? Let’s dive in.
Produced by ADP Research in collaboration with the Stanford Digital Economy Lab, this report offers a unique, high-frequency snapshot of the labor market. It’s based on anonymized payroll data from over 26 million private-sector employees, making it one of the most comprehensive and timely measures available. And this is the part most people miss—ADP’s Pay Insights tracks over 15 million individual pay changes monthly, providing granular insights into wage trends.
Dr. Nela Richardson, ADP’s chief economist, noted, ‘Small establishments ended the year on a positive note, recovering from November’s job losses, while large employers took a step back.’ This contrast raises questions: Are small businesses becoming the new drivers of job growth? Or is this a temporary blip?
December 2025 Report Highlights
Jobs Report:
- Overall Growth: Private employers added 41,000 jobs, led by education/health services (+39,000) and leisure/hospitality (+24,000).
- Industry Breakdown: Service-providing sectors (+44,000) outpaced goods-producing sectors (-3,000), with manufacturing shedding 5,000 jobs.
- Regional Trends: The South led with 54,000 new jobs, while the West saw a steep decline of 61,000 jobs, primarily in the Pacific region.
- Establishment Size: Small businesses (+9,000) and medium-sized firms (+34,000) drove growth, while large establishments added only 2,000 jobs.
Pay Insights:
- Job-Stayers: Annual pay rose 4.4%, unchanged from November. But here’s a thought-provoking detail—job-changers saw a 6.6% pay increase, up from 6.3%. Does this suggest loyalty is less rewarding than mobility?
- Industry Pay Trends: Financial activities (+5.2%) and manufacturing (+4.8%) led pay growth for job-stayers, while other services (+4.0%) lagged.
- Firm Size Pay Gap: Large firms (+4.8%) offered higher pay increases than small firms (+2.3% to +3.9%). Is this gap widening, and what does it mean for workers?
Controversial Question: As job-changers outpace job-stayers in pay growth, should employees prioritize loyalty or frequent career moves? Share your thoughts in the comments!
For a deeper dive, explore the full report and interactive charts at www.adpemploymentreport.com. The January 2026 report will be released on February 4, 2026, at 8:15 a.m. ET.
About ADP Research:
ADP Research is committed to shaping the future of work through data-driven insights. With over 75 years of expertise, ADP empowers businesses, workers, and policymakers worldwide. Learn more at www.adpresearch.com.
About ADP (NASDAQ: ADP):
As a global leader in HR and payroll solutions, ADP serves over 1.1 million clients in 140+ countries. Their mission? Always Designing for People. Discover how they’re transforming workplaces at ADP.com.
Final Thought: With small businesses leading job growth and pay disparities widening, is the labor market entering a new era? Let’s discuss—what trends are you seeing in your industry?
