Job growth in the private sector decreased in December, according to data from the ADP report.

U.S. Labor Market Slows Down in December 2024

The U.S. labor market showed a more modest pace of growth in December 2024, with a slowdown in both hiring and pay gains, according to Nela Richardson, chief economist at ADP.

Private-sector employment increased by 122,000 jobs in December, with the majority of these jobs created primarily in large and medium-sized companies. The largest employment increase was recorded in larger enterprises, although specific regional data for December 2024 on job creation or the region with the greatest employment growth is not provided in the available sources.

The service-providing sector led the way, adding 112,000 jobs. The education and health services industry accounted for 57,000 of these positions, while leisure and hospitality added 22,000 jobs. Financial activities and other services each contributed 12,000 and 13,000 jobs, respectively.

Health care was the sector that created the most jobs in the second half of 2024. The Mountain region in the Western U.S. added 26,000 jobs, and the Pacific region accounted for 56,000 jobs of the total December growth. The South and Northeast each added 19,000 jobs. The Midwest saw more modest growth of 7,000 jobs, while the goods-producing sector added 10,000 jobs overall.

However, there were some sectors that experienced a decline. Manufacturing experienced a decline of 11,000 positions in December, and the natural resources and mining sector lost 6,000 jobs. Trade, transportation, and utilities grew modestly by 8,000 jobs.

Pay gains were highest in construction (+5.1%) and financial activities (+4.9%). However, pay growth for job-changers declined slightly, reaching 7.1% in December. Annual pay growth for job-stayers slowed to 4.6% in December. The natural resources and mining sector saw the lowest growth (+3.8%) in pay gains.

Medium-sized businesses (50-499 employees) reported the strongest pay growth for job-stayers, at 4.8% in December. Medium-sized establishments contributed 9,000 jobs in December. Small establishments added 5,000 positions in December, with a slight decline among the smallest businesses (1-19 employees).

Overall, the U.S. labor market showed fluctuations in 2024 and 2025, with overall stable employment numbers but with concerns over data quality and modest job gains in recent months.

Job growth in the private sector decreased in December, according to data from the ADP report.