Greetings and welcome to the National Employment Report call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press the one followed by the four on your telephone. If at any time during the conference you need to reach an operator, please press star zero. As a reminder, this conference is being recorded Wednesday, January 5th, 2022 . I would now like to turn the conference over to Miss Joanna DiNizio with ADP. Please go ahead.
Thank you. Good morning and welcome to the December 2021 ADP National Employment Report Media Conference call. With us is Nela Richardson, Chief Economist at ADP. Nela will share her thoughts on the December findings, which is derived from ADP's actual data of those who are on a company's payroll and produced in collaboration with Moody's Analytics. Then she'll take as many of your questions as possible. Stop at 9:00 A.M. Eastern Time. Nela, please go ahead.
Thank you, Joanna, and good morning everyone. Happy New Year. I hope everything is healthy and safe wherever you are. Let's just get started with this December report. We saw that private sector payrolls grew by 807,000 on net. This number brings the fourth quarter average to 625,000, surpassing the 514,000 average per quarter for the year. It's very important to note that these latest numbers reflect the 12th of the month reference week, and we view this as a small window between when the Delta variant was fading and before the acceleration and rapid spread of the Omicron variant. Hence, the December strength could be a standout month, and the effect of rising COVID cases are likely to be more strongly reflected in January data.
With this important caveat noted, the stronger December report from the previous month was anticipated by the 25% drop in jobless claims from the November to the December reports. Jobless claims are now not only at pandemic lows, but near historic lows, with early December numbers hitting levels last seen in 1969. The most recent federal data shows that job openings remain near record highs as businesses were still looking to staff up to meet surging demand late in the year despite the ongoing uncertainty created by the pandemic. Both of these data points we regard as signals that companies are actively trying to retain their existing workforce as well as hire new workers. In total, job gains were greater than 6 million in 2021.
However, with a solid jobs recovery in place, private sector payrolls still ended the year nearly 4 million jobs short of pre-COVID-19 levels. Not only that, we don't discuss this, I think nearly enough in commentary in general across the labor market. The pandemic stripped the economy of nearly two years of labor market growth in excess of 2019 levels. Even if you think of a lackluster average of 100,000 per month, that would've accounted for at least 2 million additional jobs over the pandemic economy. While these gains are encouraging, it's worth noting that the workforce has shrunk. It is smaller than where we started. With this in mind, we saw strong gains in December, and they were broad-based in both goods producers, which accounted for 138,000 jobs.
This is the strongest reading of 2021. While service providers added a very robust 669,000 jobs. What I'd like to do is highlight a couple of sectors and in my comments sprinkle a little bit about what we saw in December versus what we might see in coming weeks due to the impact of Omicron. Let's start with construction payrolls, which grew by an impressive 62,000 in December. That's the strongest gain of the year and double the 2021 average. The housing market, as we know, is one of the most interest rate sensitive. It also has been shown in economic research to be the sector that leads the economy into and out of recession historically. It's been supported by very low interest rates which have been supported by the Federal Reserve during the pandemic period.
That industry, we saw that construction jobs actually are gaining in terms of where it was before. I'm going to go down to manufacturing, where we saw strength despite supply shortages. Here, the risks are still pronounced. It is because the Omicron variant this industry was able to power through quite a bit of those challenges, but we still don't know what the effect will be in terms of supply bottlenecks coming down the pike. Now let's turn to the service sector, because the service sector had impressive gains over the last month. Those gains were really led by in a broad-based way across industries, starting with professional business services.
Professional business services were strong, and we've seen a tilt in the drivers of this particular sector. Not just the high-paying jobs, but also the administrative support roles that are necessary for this, for people to go back into the office. Now, one of the places where we might see some stalling out next month is these administrative roles, given the fact that workers and even consumers might feel less comfortable going into places of business, and so we're watching for that. I'd also like to note education and health services, which continue to be driven by the health service sector. 85,000 jobs created in this industry alone, 75,000 coming from healthcare. But we've also noted reported staffing shortages due to rising COVID cases.
Again, this is a place to watch out for in terms of new month impact, see in January. Finally, turning to trade, transportation, and utilities. We saw a big boom in holiday hiring that matches the boom in holiday spending on the consumer side, 138,000 jobs created in this sector alone. Again, Omicron's impact on consumer willingness to go into stores might be felt, as well as the retail sector undergoing structural headwinds that have been long in the making. While we regard the December report as strong, again from an industry level, services are still vulnerable to the new variant. I'd like to finish out by looking at the size detail because I think this is really important.
We know that small businesses led the rebound in hiring early on in the jobs recovery. That has shifted. Large businesses have driven gains for quite a few months now. Large businesses in excess of 1,000 employees created 319,000 jobs in December. You know, medium and small businesses also carried their water. I mean, medium businesses added 214,000. Small businesses, again, over 100,000. Still seeing robust growth in smaller firms, but definitely large businesses are dominating in hiring. They're better able to hire, to recruit, and retain in this environment where we've seen remarkable turnover and upheaval. Great report for December, very encouraging across all levels, matches what we saw in terms of the economic growth statistics that look very strong in the fourth quarter.
Still as we also recognize some headwinds to this pandemic that is still very much present and in the driver's seat of the jobs recovery. With that, I'll turn it back to Joanna DiNizio to answer your questions.
Thank you, Nela. Operator, we are ready for questions.
Thank you. If you would like to ask a question, please press the one followed by the four on your telephone. You will hear a three-tone prompt to acknowledge your request. If your question has been heard and you'd like to withdraw your registration, please press one three. Once again, press one four to ask a question. Our first question comes from the line of Anneken Tappe. Please go ahead.
Hi. Good morning, Nela. How are you?
Good morning, Anneken.
I was hoping that you could expand a little bit about your worries about Omicron showing up in subsequent reports, 'cause obviously this was an amazing way to close out the year. Do you think we might have a very sobering few data points at the beginning of February? Just because at least anecdotally, it seems just that everyone is having it and businesses are really, really struggling. I can almost not see how this kind of job growth could be sustained. I was wondering if you could expand a little bit on that.
Sure. Omicron is definitely unwelcome. Just when we saw that supply chain issues were starting to, there was data showing that they were starting to kind of ease these bottlenecks, here we go with another variant. There is encouraging signs. I don't think we are where we were a year ago, and that's also an important caveat to note that vaccines are widely available. Even some of our youngest children can be vaccinated. There is much more attention to testing and treatment. So far, the evidence is that Omicron is less severe than other variants. I don't think we're going to see the kind of early year trends that we saw in 2021. This is a hiccup.
This is a speed bump on the road to recovery. How long does it last? We've also seen, and I'm reading the same reports that you are, Anneken. I am not a health professional, though my family did try to push me into the medical field. They continue to be disappointed by my choice. I'm not. I don't pretend to have some advanced knowledge of the projection of the virus and how it's gonna spread. I do, though, reflect the uncertainty that the virus causes to businesses in terms of planning and hiring. There is some encouragement that demand is still there.
It's really about whether we can get workers back into the labor market, see that labor force participation continue to improve so that we can continue to see hiring gains, at least past the peak of the variant, hopefully January through the later spring months.
Great. Thank you.
Sure. Thanks for the question.
Once again, to ask a question, please press one-four on your telephone. Ms. DiNizio, we have no further questions. I'll turn the call back over to you.
Thank you. Thank you everyone for joining us this month. We look forward to having you back here for our next report, which will be released on February second. The call is now concluded.
That does conclude the conference call for today. We thank you for your participation and ask that you please disconnect your lines. Have a great day, everyone.