ADP New Jobs Report: Franchises Created 10 Percent of All New Jobs Over Past Year
Franchise jobs grew by 19,160 in May.
ADP reports that the franchising sector added 19,160 new jobs in May and has created more than 150,000 new jobs over the past year. Restaurants, business services, food retailers and auto parts and dealers led the way.
ADP’s report, released June 20, in collaboration with Moody’s Analytics, Inc., showcases the significant number of jobs created by the franchise industry. The ADP National Franchise Report, the first and only of its kind, utilizes actual transaction data to measure the number of new private-sector franchise jobs created.
“With the launch of the ADP National Franchise Report today, ADP is showing they clearly recognize the power of franchising to the economy and the importance of promoting this very critical growth economic machine,” said IFA Chairman and Roark Capital Group Managing Dir. Steve Romaniello, CFE.
Overall, according to Moody’s Analytics Chief Economist Mark Zandi, the franchise industry is roughly the size of the financial services industry, directly supporting 6 percent of all private sector U.S. jobs and, unlike other industries, spanning coast-to-coast in every community throughout the country.
“Franchise employment has been growing almost double the rate of employment more broadly. It’s been important to the economic recovery, particularly more recently,” Zandi stated. He added that franchise employment is “about 10 percent of job growth over the past year, so it’s providing more than its fair share.”
“This new report is further confirmation of the significant impact of the franchising industry on the U.S. economy,” said International Franchise Association Pres. & CEO Steve Caldeira, CFE. “The results of the ADP monthly National Franchise Report will further help us demonstrate to policymakers that pro-growth policies out of Washington will help franchise businesses, which create two out of every three new private-sector jobs, to maximize their job creating potential.”
“During the month of May, U.S. franchise employment increased for most of the franchise industries the ADP National Franchise Report measures, with restaurants, business services and food retailers showing the largest increases,” said Ahu Yildirmaz, senior director of the ADP Research Institute. “In May, these three industries generated a combined total of 17,590 private-sector franchise jobs – offset primarily by losses in education and professional services in May.”
This new report reinforces the findings of IFA research on the economic impact of franchising. The Franchise Business Index, an index of the economic health of the industry, increased by 0.3 percent in May, driven by improved credit conditions and small-business optimism. May’s improvement is the sixth straight monthly increase.
Going forward, the new ADP report will be released on the third Wednesday each month and will provide another barometer of the state of the franchise industry and its impact on the economy.
ADP provides global human capital management solutions and Moody’s Analytics helps capital markets and credit-risk-management professionals worldwide respond to an evolving marketplace. ADP is the founding IFA Public Affairs Conference & Franchisee of the Year Award sponsor.
John Reynolds, CFE, is president of the International Franchise Association Educational Foundation. Find him at fransocial.franchise.org via the directory.