A big miss for the December jobs report showing job growth that was less than half of what was predicted, according to the Burea of Labor Statistics…(BLS)
- Total nonfarm payroll employment rose by 199,000 in December and the unemployment rate declined to 3.9%
- Economists had projected 400k jobs created in December.
The biggest growth continued to be in leisure and hospitality with 53k new jobs in December followed by professional and business services (+43,000) and manufacturing added 26,000…
- THE GOOD NEWS: Job growth averaged 537k per month in 2021 and employment has increased by 18.8 million since April 2020.
- THE BAD NEWS: Employment is still down by 3.6 million, or 2.3% from its pre-pandemic level in February 2020.
Wages beat expectations for the year and month, but the problem is they are not keeping pace with inflation anymore…
- Wages were up 0.6% for the month which beat the expectations of 0.4% growth. The year-over-year data showed 4.7% growth which also beat estimates of 4.2%.
- Unfortunately, even with robust wage growth prices are still rising faster. The latest data shows core PCE at 4.7% and full PCE at 5.7%.
NOTE: October’s numbers were revised upward to 648,000, and November was also revised upward to 249,000. With these revisions, employment in October and November combined is 141,000 higher than previously reported.
QUOTE: “Employers can’t hire people who aren’t looking for work, and that’s holding back job growth.” – Neil Irwin at Axios
- Irwin notes that employers want to create new jobs, and are hiring the formerly unemployed, driving down the jobless rate. However, isn’t coaxing more people to work. The share of adults in the labor force was unchanged in December and remains 1.5 percentage points below pre-pandemic levels.
POINT: President Joe Biden on Friday, “We have added 6.4 million new jobs since January of last year — in one year. And that’s one of the most — that’s the most jobs in any calendar year by any president in history. How? How? How did that happen? Well, the American Rescue Plan got the economy off its back and moving again, back on its feet…” (White House)
COUNTERPOINT: Matt Weidinger: December jobs report confirms Democrats’ $1.9 trillion American Rescue Plan didn’t produce a single promised job in 2021 (AEI)