Small Employers Shed More Jobs

Payrolls at small businesses fell to a seven-year low in November, ADP reports.

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Small employers continued to slash payrolls  in November, shedding 79,000 jobs, the sharpest decline in seven years, ADP reported this week.

Total private-sector employment shrank by 250,000 jobs last month, including 92,000 service sector jobs, the report said.

In recent years, smaller service-sector businesses have led the nation's job growth with steady month-to-month gains. Last month, businesses with fewer than 50 employees accounted for about a third of service-sector job losses.

The downturn marked only the second consecutive monthly decline in small business employment since November 2002.

"Today's employment decline clearly indicates that the recession  has now widened to include businesses of all sizes," said Joel Prakken, the chairman of Macroeconomic Advisors, a St. Louis, Mo.-based economic forecasting firm that prepares the monthly ADP employment reports.

A separate report released Wednesday by SurePayroll, a Chicago-based payroll firm, showed hiring by small businesses was flat last month, rising less than one percent. At the same time, salaries fell by 0.39 percent, the report showed. Year-to-date, salaries  paid by smaller employers have declined by 2.6 percent, averaging just over $31,000.

"Employees who are getting back into the workforce  will be earning less than they might have earned one year ago," SurePayroll President Michael Alter said in a statement.

The government's labor market report is scheduled to be released on Friday.

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