According to Inc, the government shutdown has entered its second month, preventing the Bureau of Labor Statistics from producing regular monthly jobs reports since September. Private payroll companies have stepped in with their own data, revealing a confusing picture: ADP reported 42,000 job gains in October, while Gusto showed 5,900 job losses among small businesses. Homebase’s data indicated workforce participation decreased by 2.9% in October, with hiring down 5% compared to October 2024. The last official government data from September showed only 26,750 positions created monthly between May and August. Business leaders are now navigating this “fog” of conflicting private data as they make critical hiring and investment decisions.
So what’s actually happening?
Here’s the thing – we’re getting completely different stories from different data providers. ADP says businesses added 42,000 jobs in October, which sounds positive until you realize that’s less than a quarter of the average 180,000 monthly hires we saw back in 2024. Meanwhile, Gusto’s small business data shows job losses continuing a decline from July’s peak of 57,400 new hires down to negative territory. And Homebase paints yet another picture with workforce participation dropping nearly 3%. Basically, everyone’s looking at different slices of the economy and getting different answers.
The “Great Freeze” continues
The most concerning trend might be what Gusto calls the “Great Freeze” – hiring for small businesses peaked at nearly 3.4 million per month back in January 2022 and has since fallen by 37%. We’re seeing hiring slow dramatically across the board, but is this just cautious optimism or the beginning of something worse? The Gusto report shows small businesses were adding 170,000 net new jobs monthly during the post-pandemic hiring surge of 2021. Now we’re seeing losses. That’s a massive shift in just a few years.
How businesses are navigating the fog
Appcast chief economist Andrew Flowers makes a good point – without the reliable government data we normally rely on from sources like the Bureau of Labor Statistics, businesses have to use whatever “headlights” they can find. The private data from companies like ADP and Homebase might be imperfect, but they’re better than driving completely blind. The risk here is what Flowers calls “bad vibes” – when business leaders see big companies like Amazon and Target announcing layoffs, they might defensively cut headcount too, even if their own business doesn’t require it.
What comes next?
The real question is whether this slowdown represents a temporary pause or something more structural. Flowers notes that consumer spending and business investment have been surprisingly resilient, and real-time GDP tracking estimates show Q3 was quite strong. So we might be looking at cautious hiring rather than impending disaster. But without clear government data to guide decisions, every business leader is essentially flying by instruments they don’t fully trust. They’ll need to carefully monitor their own operations while waiting for the fog to lift – whenever that might be.
