Franchise Employment Growth Slows

Private sector employers continued to add jobs in July, according to the latest National Employment Report from the human resources firm ADP.

But employment growth in the franchise sector slowed down. To be sure, the business model added 17,010 jobs in July, or 0.2 percent growth. That's the same rate as the private sector as a whole, but in previous months the sector had outpaced overall employment growth. The number of hires in July was about half the rate as hired in June.

Indeed, a number of franchise heavy industries slowed down in July, notably restaurants, which added 6,240 jobs in the month. That was still enough to lead the sector—it is, by far, the biggest and most worker heavy industry that uses franchising—but it represented growth of just 0.1 percent. It was also just more than half the number of workers the industry added in June.

The restaurant industry's growth in recent months has been a big reason for the overall growth in the franchise sector in the past two years.

Likewise, auto parts dealers added 5,430 jobs. That, too, was half as much as that industry hired in June, but it was still a growth rate of 0.4 percent, twice as much as the franchise sector and as the private sector as a whole.

Overall, private sector employers added 218,060 jobs in July, up 0.2 percent.

Numbers for specific industries, and franchising, can be volatile from one month to the next. And while the sector's growth slowed in July, franchising is still in a jobs-adding mode, meaning that franchises are adding new units and adding workers at existing locations. And that growth should continue so long as the overall employment picture continues to improve.