The labor market finished 2022 strong with private payrolls adding 235,000 jobs in December, according to a report from payment processing firm ADP.
The numbers were well above the Dow Jones estimate of 153,000, which surprised investors who were banking on some slowing in the job market to put the Federal Reserve at ease.
Hospitality and leisure led the gains with 123,000 positions, followed by business services with 52,000 positions and health care and education with 42,000.
Looking at the bigger picture, Nela Richardson, chief economist at ADP, explained that "the labor market is strong but fragmented" by industry and company size.
"Business segments that hired aggressively in the first half of 2022 have slowed hiring and in some cases cut jobs in the last month of the year," she said.
Case in point: Salesforce on Wednesday announced plans to cut 10 percent of its workforce after admitting to overhiring during the COVID-19 pandemic. The cuts are the largest in the company's 23-year history and will impact about 8,000 employees.
Not to be outdone, Amazon on Thursday revealed plans to cut more than 18,000 jobs, which is a higher number than the company let on when it first announced layoffs in November.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” CEO Andy Jassy said in a note to employees released to the public. “These changes will help us pursue our long-term opportunities with a stronger cost structure.”
The Wall Street Journal first reported the layoffs based on an internal leak, which prompted Amazon to make an official announcement ahead of schedule.
Jassy wrote in the note that the bulk of the layoffs will impact brick-and-mortar stores such as Amazon Fresh and Amazon Go outlets and PXT organizations that handle back-end operations such as human resources. "Companies that last a long time go through different phases," he wrote. "They’re not in heavy people expansion mode every year."
Rounding out the latest tech layoff news is Stitch Fix. The online personal styling service said it will be cutting 20 percent of its salaried workers. It will also be closing its Salt Lake City distribution center, and CEO Elizabeth Spaulding will be stepping down.
“Stitch Fix continues to embark on an ambitious transformation and in the immediate term, the focus for the team is squarely on creating a leaner, more nimble organization to set the company up for a return to profitability," said founder Katrina Lake, who will be stepping in as CEO.
