Competition for Workers Heated Up in January, Franchise Hiring Slowed Down
U.S. franchise establishments added 19,700 jobs in January 2018, according to the ADP Research Institute. That is the lowest rise in hiring for franchises since September of 2017. It falls in the range of average and slower than its counterparts of small businesses and private sector employment.
The three largest franchise sectors of restaurants, auto dealerships and hotels were up the most in the total number of hires.
The change in employment hiring for small businesses of under 50 employees was up 58,000. That is less than December's figure, but higher than November's.
For the general economy, private sector employment increased by a robust 234,000 jobs on a seasonally adjusted basis. Although that was slightly down from December’s 250,000 job gain, it was significantly higher than November’s and is considered strong. Midsize and large firms added a vigorous 91,000 and 85,000 jobs respectively.
“We’ve kicked off the year with another month of unyielding job gains,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “Service providers were firing on all cylinders, posting their strongest gain in more than a year. We also saw robust hiring from midsize and large companies, while job growth in smaller firms slowed slightly.”
These numbers indicate that the U.S. unemployment rate is heading down and finding workers will be more of a challenge for businesses.
Mark Zandi, chief economist of Moody’s Analytics, said, “The job market juggernaut marches on. Given the strong January job gain, 2018 is on track to be the eighth consecutive year in which the economy creates over 2 million jobs. If it falls short, it is likely because businesses can’t find workers to fill all the open job positions.”
The employment numbers are derived from payroll service firm ADP and the actual payroll data from American firms that it collects and analyzes. The U.S. private sector employment report is used by economists as a barometer for the Department of Labor’s report on jobs, which will be released tomorrow, Friday.