Small businesses lead November job losses as tariff uncertainty weighs on hiring

Published: Thursday, December 4, 2025 at 1:30 pm

Small Businesses Suffer Job Losses Amid Economic Uncertainty

A recent report from ADP reveals a concerning trend in the U.S. labor market, with small businesses leading job losses in November. The ADP private sector payrolls report indicated an overall decline of 32,000 jobs, driven primarily by small businesses, which shed 120,000 jobs during the month. This contrasts with medium-sized businesses, which added 51,000 jobs, and large establishments, which added 39,000 jobs.

Economists attribute this downturn to a confluence of factors, including economic uncertainty and cautious consumer behavior. The report highlights that the slowdown was broad-based, but small businesses were disproportionately affected. Experts suggest that small businesses are particularly vulnerable to economic shifts and policy changes, such as tariffs.

The impact of tariffs is a key concern. The fluctuating nature of tariff rates creates uncertainty for businesses, making it difficult to predict future costs and plan accordingly. This uncertainty is particularly challenging for small businesses, which often lack the resources to navigate complex trade environments.

The job losses were observed across both goods-producing and service-providing industries. In the service sector, professional and business services, as well as information services, experienced job cuts. Conversely, education and healthcare saw job gains. Within goods-producing industries, manufacturing and construction firms reported job losses, while natural resources and mining saw an increase.

The situation is further complicated by differing perspectives on the labor market's health. While the ADP report points to a decline, data from the National Federation of Independent Businesses (NFIB) suggests that the labor market remains in positive territory, although it has cooled. The NFIB notes that small businesses are struggling to find suitable workers, adding to the challenges they face.

BNN's Perspective: The data paints a mixed picture of the economy. While the overall job market remains relatively stable, the struggles of small businesses are a cause for concern. The uncertainty surrounding tariffs and the broader economic outlook warrants careful monitoring. Policymakers should consider measures to mitigate the negative impacts of economic volatility on small businesses, which are crucial for job creation and economic growth.

Keywords: small businesses, job losses, ADP report, tariffs, economic uncertainty, labor market, manufacturing, service sector, employment, inflation, economic growth

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