The latest figures from payroll giant ADP reveal a concerning trend: private sector employers in the U.S. shed 32,000 jobs in November cnn.com. This national contraction is likely to have a ripple effect on Hawaii's economy, already grappling with its own unique set of challenges. While the official November jobs report is delayed, ADP's data serves as the "next-best estimate on the labor market" cnn.com.
Small businesses, which often serve as an economic bellwether, appear to be leading the slowdown, according to ADP, with the greatest job losses occurring within establishments employing fewer than 50 people adp-ri-nrip-static.adp.com. This trend underscores the difficulties small business owners face in navigating a potentially weakening economy. Highlighting this trend, the NFIB's October jobs report found that 32% of small business owners had job openings they could not fill. These businesses are now caught between a lack of qualified applicants and the rising costs of doing business.
The implications for Hawaii's entrepreneurs are significant. Small businesses in the islands are now experiencing "choppy" hiring conditions adpemploymentreport.com, which makes it difficult to maintain adequate staffing levels to meet consumer demand and achieve business goals. The rising minimum wage, a reality for Hawaii businesses, adds another layer of complexity. With labor costs increasing, businesses may need to re-evaluate their hiring strategies, potentially delaying hiring, not replacing workers, or even considering layoffs.
Adding to these concerns, businesses in Hawaii continue to absorb price increases. ADP's chief economist, Nela Richardson, suggests that there are “a lot of different angles of concern for the smallest firms: It’s about supply, it’s about high price levels” cnn.com. This combination of reduced hiring, rising labor costs, and ongoing inflationary pressures presents a challenging environment for Hawaii’s business community. Businesses will likely need to find creative solutions to boost performance and contain costs in 2026.
