Payroll-processing giant ADP reported Tuesday that the U.S. labor market is showing further signs of weakening, with layoffs accelerating across private companies. According to ADP’s latest update, private employers have shed an average of 13,500 jobs per week over the past four weeks—an increase from 2,500 job losses per week in the previous update just a week ago.
The latest reading represents a nearly 20% increase in job losses compared with ADP’s prior four-week period, when employers cut an average of 11,250 jobs per week through October 25. Conditions had appeared steadier earlier in the month, when ADP reported that private-sector payrolls rose by 42,000 in October and wages were up 4.5% year over year. However, data released a week later painted a weaker picture for the end of the month.
ADP’s chief economist Nela Richardson described current conditions as a “C-plus, B-minus labor market,” according to a CNBC segment cited by reporter Carlos Quintanilla on Bluesky.
The report also highlights a shift in hiring patterns. New hires now make up a larger share of the workforce even as overall hiring slows, a sign that employers are primarily backfilling departures rather than expanding staff. This trend aligns with an aging labor force, where 36% of workers are 55 or older, and participation rates remain below pre-pandemic levels. ADP’s data suggests that the number of people actively seeking employment has declined over the past year, largely due to retirement.
As a result, turnover has cooled across several industries—particularly healthcare, education, and hospitality—while customer-facing jobs have seen greater employee retention. Wage growth has also stagnated, with median hourly pay stuck at $18 for more than a year.
Because of the ongoing government shutdown, federal agencies have delayed major data releases, leaving alternative sources such as ADP to provide a clearer view of current labor trends. Government offices, including the Bureau of Labor Statistics (BLS) and the Bureau of Economic Analysis (BEA), have issued revised reporting schedules. Crucial releases such as the monthly nonfarm payrolls report have been postponed until December, depriving policymakers at the Federal Reserve of key economic data ahead of their December 9–10 meeting.
Despite the uncertainty, several Fed officials have advocated for additional interest-rate cuts, prompting markets to recalibrate expectations for a reduction at next month’s meeting.
Jan Hatzius, chief economist at Goldman Sachs, wrote in a client note that “with the next jobs report now scheduled for December 16 and CPI for December 18, there is little on the calendar to derail a cut on December 10.” Hatzius added that when new releases begin, “alternative indicators show renewed job losses in October,” even though the BLS last week reported a stronger-than-expected 119,000 payroll increase for September.
The Goldman Sachs team expects the Fed to respond with a rate cut in December, followed by two additional quarter-point reductions in 2026, as policymakers navigate a labor market losing momentum and an economy showing signs of fatigue.