Quick Facts:
- Total nonfarm payroll employment increased by 216,000 in December.
- The federal unemployment rate was unchanged 3.7 percent.
- Employment continued to trend up in government, health care, social assistance, and construction, while transportation and warehousing lost jobs.
- The unemployment rate held at 3.7 percent in December, and the number of unemployed persons was unchanged at 6.3 million. These measures are higher than last year, when the jobless rate was 3.5 percent and the number of unemployed persons was 5.7 million.
- The number of persons employed part time for economic reasons, at 4.2 million, changed little in December.
Looking Forward:
- Hiring was revised down in both October and November. For all of 2023, employers added 2.7 million jobs, or an average monthly gain of 225,000 jobs. This was lower than the increase of 4.8 million in 2022 (with an average monthly gain of 399,000), but a bigger gain than in the years preceding the pandemic.
- Wage growth ticked up slightly last month. Average hourly earnings, an important measure for inflation, rose 0.4% to $34.27. Over the past 12 months, average hourly earnings have increased by 4.1%. The number of unemployed Americans who want a job climbed to 5.7 million in December and was up by 514,000 overall in 2023.
- With the labor market demonstrating continued resiliency, the Fed might not be in any rush to initiate a rate cut. But, there are signs the job market is cooling – the number of job openings fell in November to 8.79 million from 8.85 million in the prior month.
- In the press conference following the Federal Open Market Committee decision last month, Fed Chair Jerome Powell said that while “there’s little basis for thinking the economy is in a recession now… there’s always a real possibility there will be recession in the next year.”
Source: U.S. Bureau of Labor Statistics – The Employment Situation – December 2023
