Hiring by U.S. private companies grew in December. But the number was lower than expected. It was still a clear improvement from the previous month.
Private employers added 41,000 jobs in December. This data came from ADP. In November, payrolls had fallen by 29,000. Economists had expected a bigger rebound of 49,000 jobs.
ADP said hiring picked up toward the end of the year. The growth was mainly seen in education and health services. Leisure and hospitality also added jobs.
Small businesses showed improvement after losing jobs in November. They hired more workers in December. Large companies, however, slowed down their hiring.
ADP’s chief economist Nela Richardson said smaller firms helped lift overall job numbers. She added that big employers remained cautious.
The report comes at an important time for the Federal Reserve. Policymakers are closely watching the job market. A softer labor market was one reason the Fed cut interest rates last year.
Some Fed officials believe job growth needs more support. They have said employment should be protected even as inflation remains stubborn.
The ADP report is created with help from Stanford’s Digital Economy Lab. Later this week, the government will release its own jobs report. This comes from the Bureau of Labor Statistics.
That report is seen as a more complete picture of the job market. Economists expect December nonfarm payrolls to rise by 57,000. In November, the increase was 64,000.
Separate data released on Wednesday showed fewer job openings. Open positions stood at 7.146 million in November. This was below expectations of 7.610 million. In October, job openings were higher at 7.449 million.