U.S. employers added 50,000 jobs in December as hiring slowed
The unemployment rate slipped to 4.4%, but downward revisions showed weaker job growth in October and November than first reported.
By Sofia Marchetti · Columnist
· 2 min read
U.S. job growth stayed soft in December, with employers adding 50,000 jobs, according to the Bureau of Labor Statistics. For everyday investors, the key takeaway is that the labor market is still expanding, but at a much slower pace than earlier in the cycle.
Nonfarm payrolls, the government’s broad count of jobs across the economy excluding farm work and a few other categories, rose by 50,000 in the month. The unemployment rate moved down to 4.4% from 4.5% in November, the BLS reported.
The headline number was only part of the story. The BLS also revised prior months lower, cutting October payrolls by 68,000 and November by 8,000. October is now reported as a loss of 173,000 jobs, compared with the earlier estimate of a 105,000 decline. November is now reported at a gain of 56,000, down from 64,000.
Together, those revisions mean employment for October and November was 76,000 jobs lower than previously reported. Using the revised figures, the economy has added 93,000 jobs since April, covering an eight-month stretch.
Where jobs were added and lost
The BLS said hiring continued to move higher in food services and drinking places, health care, and social assistance. Retail trade, by contrast, shed jobs in December.
Private employers added 37,000 jobs during the month, while government payrolls increased by 13,000. That split matters because private payrolls can offer a cleaner look at business demand for labor, while public payrolls reflect hiring by federal, state, and local government employers.
On a year-over-year basis, total nonfarm employment was up by 594,000 jobs in December. The data show that employment growth has slowed sharply compared with stronger periods earlier in the expansion.
Participation ticked lower
The labor force participation rate fell to 62.4% in December from 62.5% in November, according to the BLS data. That rate measures the share of the working-age population that is either employed or actively looking for work.
The employment-population ratio moved in the other direction, rising to 59.7% from 59.6%. That ratio measures the share of the population that is employed, rather than just participating in the labor force.
The combination of a lower unemployment rate, modest job gains, and downward revisions gives investors a mixed read. The labor market did not contract in December, but the latest figures show a weaker hiring trend than earlier estimates suggested.
The report was slightly below consensus expectations, and the downward revisions to October and November made the overall picture softer. For markets, labor data like this can influence expectations for economic growth and interest-rate policy, though the BLS report itself does not make any policy projection.
This story draws on original reporting from Calculated Risk.
