U.S. Private Payrolls Edge Lower, Small Business Confidence Slips to Six-Month Low 

Private-sector employment momentum weakened in late October, according to ADP’s latest National Employment Report, which estimated that U.S. private employers reduced payrolls by an average of 11,250 per week over the four weeks ended Oct. 25, 2025. The data, which remain preliminary, may be revised as additional information becomes available, ADP noted. 

ADP recently began publishing more frequent labor market updates. These weekly readouts, issued with a two-week time lag, are based on a four-week moving average to provide a timelier snapshot of private-sector employment trends. 

A sustained rise in layoffs at this stage of the cycle would be especially concerning, given that the hiring rate remains subdued, and job-finding opportunities for displaced workers have become more limited than in previous expansions. 

The slowdown follows last week’s report showing that employers added 42,000 jobs in October after two months of declines, suggesting the labor market remains uneven heading into year-end. ADP analysts said the recent data reflect “a labor market struggling to consistently generate new positions” amid a broader economic cooling. 

Separately, a report from the National Federation of Independent Business (NFIB) showed that small business sentiment fell to a six-month low in October, with the NFIB optimism index slipping 0.6 points to 98.2. The decline was driven by weaker earnings trends and reduced optimism about near-term economic conditions. 

The share of small business owners reporting stronger earnings over the past three months fell nine percentage points, the steepest drop since the pandemic, weighed down by slower sales and rising input costs. 

While labor quality remained the most cited challenge, hiring pressures have eased considerably. Just 32% of small businesses said they were unable to fill open positions—the lowest level since late 2020—and reports of unqualified applicants also declined. However, hiring plans for the next three months ticked down slightly, marking the first decrease since May, reflecting a more cautious stance as growth moderates.