Private Sector Employment Contracts in January

The non-farm private employment sector shed a seasonally-adjusted 522,000 jobs from December 2008 to January 2009, according to the monthly report published Wednesday by Automatic Data Processing, Inc. (ADP) and conducted from study of business payroll information. Non-farm private employment in the services-providing sector fell by 279,000 in the month, while employment in the goods-producing sector continued in its 24th consecutive monthly decline (243,000 in January). Employment in the manufacturing sector contracted by 160,000 jobs, its 28th decline in 29 months, according to the ADP data. Large businesses with 500 or more workers reported shedding 92,000 jobs, while medium-sized businesses with staffs between 50 and 499 workers shed 255,000 jobs. Small businesses with fewer than 50 workers lost 175,000 jobs in January, according to the data. Construction employment fell for the 22nd consecutive month, bringing total construction jobs lost to 923,000 since the peak in January 2007. “Sharply falling employment at medium- and small-size businesses clearly indicates that the recession continues to spread well beyond manufacturing and housing-related activities,” said Joel Prakken, chairman of Macroeconomic Advisers LLC, in an ADP media statement. Read the report. The data comes days after the Bureau of Labor Statistics last week announced regional and state unemployment rates were universally higher in December, bringing the national unemployment rate to 7.2 percent. In December, the West and Midwest again posted the highest regional jobless rates, 8.0 and 7.5 percent, respectively. The Northeast and South recorded the lowest unemployment rates, posting 7 percent each.  According to the Labor Department’s report, all four regions registered “statistically significant rate increases” from November and from the year earlier. Congress was debating as of Wednesday a financial stimulus package that House Democrats claim would keep or create some 3 million jobs. The House version of the bill was passed last week in the hopes a final version would hit President Barack Obama’s desk by mid-February. It was unclear at the time this story was published what effect the bill — if signed into law — will have on the payrolls of small, medium and large businesses. Write to Diana Golobay at [email protected].