Private payrolls came in much lower than expected last month, as the ADP Employment Report showed that there were just 106,000 jobs created in January. The construction sector accounted for 24,000 jobs lost, which is understandable given the slowdown we have seen among homebuilders. Small businesses with under 50 employees were hit hardest, as they lost 75,000 jobs, while large firms with 500 or more employees posted 128,000 job gains.

ADP also reported that annual pay for job stayers increased 7.3% year over year, which was unchanged from the previous report. Job changers saw an average increase of 15.4%, up from 15.2%.

What’s the bottom line? Nela Richardson, chief economist for ADP, said, “In January, we saw the impact of weather-related disruptions on employment during our reference week.” ADP uses the week that includes the 12th to collect payroll sampling data each month. They blamed the extreme weather during that timeframe in January, including snow in the Midwest and flooding in California, for the weaker than expected report. However, it was mild in other parts of the country and there are supposed to be seasonal adjustments reflected in the data, suggesting that weather was not the only contributing factor to the report.