Mind the revisions!

Private sector hiring in the US was far slower than expected last month, according to ADP data released on Wednesday, but the larger story might be the markdown to 2025 hiring.

This release included the annual revision to the series, which was re-weighted to the QCEW benchmark data.

Previously, the ADP series suggested hiring was robust in early 2025, but decelerated later in the year. The revised series suggests the opposite.

As the figure shows, hiring was actually negative for four straight months in and around Donald Trump’s tariff blitz. Job growth then resumed, with payrolls expanding uninterrupted for the remainder of the year.

The end result: Private payroll growth was just 398,000 in 2025, far lower than the 640,000 as initially reported and down 48% from 2024’s total.

Maybe trade wars are “good and easy to win,” as Trump famously claimed, maybe they aren’t, but they’re damn sure disruptive. That much is clear.

For January, private hiring was just 22,000, less than half the 45,000 consensus. The headline missed every estimate.

The figure above uses the revised data for 2025. January marks a second straight month of decelerating jobs growth.

ADP chief economist Nela Richardson called it “a lackluster month for hiring.” That’s an understatement. Were it not for health care — which added 74,000 jobs — hiring would’ve been negative to the tune of 52,000.

Notably in the context of sundry AI disruption narratives, professional and business services led job losses with a 57,000 decline. Manufacturing shed 8,000 workers and has “lost jobs every month since March 2024,” the release noted.

All in all, this was a poor read on hiring, and it underscored the notion that 2025 was a slow year for private sector job creation, which marks a stark contrast to Scott Bessent’s proclamations about “re-privatizing” the US labor market.