Small Businesses Add 204,000 Jobs to US Economy

Small businesses saw strong job growth during December 2021, according to the latest ADP Small Business Jobs Report.

During December, small businesses (less than 50 employees) saw an increase of 204,000 jobs. In the previous month, the small business job increase was 115,000 jobs.

Service providing jobs was the bulk of small business growth at 185,000. Businesses with 1 to 19 employees saw an increase of 96,000 jobs while those with 20 to 29 employees increased by 89,000.

Job-producing goods for small businesses grew by 19,000 (8000 very small and 11,000 small).

Franchise opportunities increased by 39,400 compared to 35,300 in the previous month.

Small businesses add 204,000 jobs

Nella Richardson, chief economist at ADP, noted that the strong growth in December occurred with reduced delta variable impact and Omicron’s readiness on the horizon.

“The job market strengthened in December as the delta variable repercussions faded and the Omicron effect is not yet visible,” Richardson said. “Job gains were broadly based, as commodity producers added the strongest reading of the year, while service providers dominated growth.”

Overall, job growth reached 807,000 jobs in December, up from an increase of 505,000 jobs during November.

“Job growth in December brought the fourth-quarter average to 625,000, outpacing the 514,000 (jobs) average for the year,” Richardson said. While job gains crossed 6 million in 2021, private sector payrolls remain nearly 4 million jobs below pre-COVID-19 levels.

In her Main Street trade blog last week, Richardson predicted interest rate and job trends.

interest rates

“Federal governors decided to start turning off the tap – slowly – on the easy money that has been flowing into the economy since the pandemic began. They also indicated that they will likely raise interest rates next year. What we don’t know is exactly when the Fed will start raising rates. Interest, how high it is, and whether more expensive borrowing — think small business loans, credit cards, mortgages — is going to hurt Main Street.”

Job and Employment Trends

National Franchise Report December 2021

“The demand for workers has never been greater. Job opportunities have jumped to record levels. On the face of it, there are more jobs than people looking for work. With the increased demand, we have moved from asking ‘Where are the jobs’ to ‘Where are the workers?’ And when will they return? “

‘Structural’ barriers that employees and employers face

“Achieving compensation equity has long-term implications. We are now also recognizing another important component of the equity equation – structural supports, such as affordable daycare, that can empower job seekers. In 2022, employers will need to decide whether to give Priority is given to equal pay and social infrastructure for their workers.”

National Employment Report December 2021

Photo: ADP

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