The loss of 301,000 private-sector positions came as a surprise to economists who had predicted businesses had added 207,000 jobs. It was also the first decline in the ADP report since December 2020.
The ADP report relies on private payrolls, unlike the government’s jobs report that counts all workers. Also of note: ADP counts workers on a company’s payroll, irrespective of whether they were out sick.
“The details of the ADP employment report indicate a large and likely temporary drag from Omicron on January employment,” economists at the bank said.
But in January, coronavirus cases spiked. That affected business, led to worker absenteeism and temporary school closures.
Underscoring multiplr pandemic labor market trends
Almost all major industries recorded losses, led by leisure and hospitality, where more than 150,000 jobs were lost. Only mining added 4,000 positions.
Small businesses with fewer than 50 employees recorded the most losses — though businesses of all sizes shed positions.
Even so, “there is good evidence to suggest that January represents a speed bump, not a stop,” as Omicron cases are starting to abate, Richardson said. Employers’ appetite to hire was strong going into 2022.