New BLS Data Show U.S. Private Businesses Added Just 88,000 Net Jobs in First Quarter

U.S. private businesses added just 88,000 net jobs in the first quarter of 2026, a sharp slowdown from the 609,000 gained in the final three months of 2025, according to data released Wednesday by the Bureau of Labor Statistics. The small increase reflects large job flows beneath the headline figure, with gains at some workplaces almost entirely offset by losses at others.

The figures cover employment changes between December 2025 and March 2026, rather than hiring in October. They provide a detailed look at how jobs moved among private-sector workplaces during the quarter, including the effects of business openings, expansions, contractions and closures.

The BLS Business Employment Dynamics report shows 7.381 million gross job gains at expanding and opening establishments against 7.293 million gross job losses at contracting and closing establishments. Their difference was the 88,000 net increase. This is a measure of jobs gained or lost at workplaces, not a count of all workers hired or laid off during those three months.

Job gains slowed much more than job losses increased

Gross job gains fell by 478,000 from the preceding quarter, dropping from 7.859 million to 7.381 million. Gross job losses moved in the opposite direction, increasing by 43,000 from 7.250 million to 7.293 million. Together, those changes narrowed the net gain by 521,000 jobs, accounting for the decline from the fourth quarter’s 609,000 increase.

The slowdown was also evident in employment-adjusted rates. Gross gains decreased from 6.0% of private-sector employment in the fourth quarter to 5.5% in the first quarter, while the gross loss rate remained at 5.5%. Because the net increase was small relative to total employment, the reported net growth rate rounded to 0.0%, even though the underlying level showed a positive change.

Most of the new positions in the first quarter came from existing workplaces adding staff. Expanding establishments accounted for 5.900 million job gains, compared with 1.481 million at opening establishments. On the other side, contracting workplaces lost 5.829 million jobs, and closing establishments accounted for 1.464 million losses.

The quarterly pattern has been uneven rather than a straight decline. Private establishments recorded net losses of 295,000 jobs in the second quarter of 2025 and 115,000 in the third, followed by the rebound late that year. The first-quarter 2026 gain was also below the 262,000 net jobs added in the corresponding period of 2025. All of these comparisons use the seasonally adjusted figures in the latest release.

Construction offset losses across service industries

The industry breakdown was mixed. Goods-producing businesses gained 96,000 net jobs, while service-providing businesses lost 8,000, leaving the private sector with an 88,000 overall increase. Gross gains exceeded losses in just six of the 13 broad industry sectors tracked in the report, showing that positive net employment growth was not widespread.

Construction accounted for a net gain of 112,000 jobs, more than the overall private-sector increase. Natural resources and mining added 14,000, but manufacturing lost 30,000 after posting a modest 7,000 gain in the preceding quarter. The goods-producing total reflects these different directions rather than uniform growth across factories, building sites and extractive businesses.

The largest negative contribution among major service industries came from transportation and warehousing, where net employment fell by 162,000. That followed a 201,000 increase in the fourth quarter. Professional and business services lost 46,000 jobs, and leisure and hospitality lost 37,000. Financial activities also ended the quarter with a net decline of 23,000.

There were pockets of service-sector growth. Education and health services gained 92,000 net jobs, and retail trade added 77,000 after losing 145,000 in the previous quarter. Taken together, the industry figures show why the headline net increase should not be read as a uniform hiring slowdown at every type of business.

Smaller firms lost jobs as larger firms expanded

A separate analysis by firm size found that businesses with one to 49 employees lost 67,000 net jobs in the first quarter. Firms with 50 to 249 employees shed another 5,000, while those with at least 250 employees added 255,000. The figures suggest that net employment growth was concentrated in larger firms, even as the broader private-sector tally remained close to flat.

There is an important statistical distinction in those numbers. The three firm-size categories sum to a net gain of 183,000 jobs, not the establishment-based increase of 88,000 used in the headline. BLS calculates industry figures for individual establishments, which are generally single workplaces, but measures firm-size changes after grouping establishments under common ownership. The two series are also seasonally adjusted independently.

As a result, gains at one location can offset losses at another location belonging to the same company before the firm-level totals are calculated. Gross gains and losses by firm were 5.784 million and 5.601 million, respectively, both lower than the establishment-level figures. Those differences do not make either measure incorrect; they mean the firm-size figures cannot be treated as components that must add up to the reported 88,000.

The smaller-firm decline also does not, by itself, establish how many businesses permanently closed. A net employment change can reflect existing firms cutting or adding positions as well as openings and closures. Firm size is allocated using BLS’s dynamic sizing method, which takes account of a business moving across employment-size categories during the quarter.

The data describe an earlier quarter, not current hiring

Business Employment Dynamics statistics are based on linked employment records from the Quarterly Census of Employment and Wages, drawing largely on employers’ unemployment-insurance reports. For the first quarter of 2026, BLS used information from about 9.5 million private-sector establishments. Government workplaces and private households are outside the national BED totals, as are establishments with no employment in either comparison quarter.

This administrative-record approach is different from the monthly payroll employment survey, which uses another collection and estimation process. The BED series is designed to reveal how employment increases and decreases are distributed among workplaces. Its publication lag is roughly seven months, so the first-quarter numbers cannot be used as a direct measure of labor-market conditions at the end of October.

The agency also reported 323,000 establishment births in the first quarter, accounting for 949,000 jobs. That narrower measure differs from the larger job-gain figure for opening establishments, which can include businesses reopening after a period without employees. Confirming permanent establishment deaths takes additional quarters, so the latest available death figures are for the second quarter of 2025, not the same period as the new birth count.

The October release incorporates routine annual revisions covering five years of seasonally adjusted data and the previous four quarters of unadjusted data. Its revised historical figures therefore provide the appropriate basis for comparisons within this report. BLS is scheduled to publish the second-quarter 2026 Business Employment Dynamics results on January 27, 2027, at 10 a.m. Eastern time.