Job creation tailed off significantly in December, pointing to an increasingly tight labor market where major gains ahead could be difficult to achieve, according to a report Thursday from ADP and Moody's Analytics.
The monthly tally for private job creation showed companies added 153,000 in the month after Donald Trump captured the presidency. That was considerably below market expectations of 170,000 and well below the 215,000 added in November. It also came amid expectations for significantly stronger growth under the new president.
"Job growth remains strong but is slowing," Mark Zandi, chief economist at Moody's Analytics, said in a statement. "The gap between employment growth in the service economy and losses on the goods side persists. Smaller companies are struggling to maintain payrolls while large companies are expanding at a healthy pace."
Indeed, businesses with fewer than 50 employees, the backbone of the jobs recovery since the Great Recession ended in 2009, added just 18,000 positions in December, with firms employing fewer than 20 employees actually cutting 3,000 jobs.
Companies with 50 to 599 employees added the most for the month at 71,000, while large firms contributed 63,000, all but 8,000 of which came from those with more than 1,000 workers.
Goods-producing companies had a particularly difficult month, cutting a net 16,000 jobs, which included a loss of 9,000 in the manufacturing sector. Natural resources and mining cut 5,000 while construction lost 2,000.