U.S. Job Growth Falls Short Of Estimates In December, Unemployment Rate Dips

(RTTNews) - The Labor Department released a closely watched report on Friday showing employment in the U.S. increased by less than expected in the month of December.

The report said non-farm payroll employment rose by 50,000 jobs in December after climbing by a downwardly revised 56,000 jobs in November.

Economists had expected employment to rise by 60,000 jobs compared to the addition of 64,000 jobs originally reported for the previous month.

The Labor Department also said the loss of jobs in October was revised to 173,000 from the previously reported 105,000.

"The economy is growing, but unevenly, and employers certainly appear to be cautious about adding additional workers, as evidenced by the still very slow hiring rate in the JOLTS data," said Mortgage Bankers Association SVP and Chief Economist Mike Fratantoni.

The modest job growth in December came as employment continued to trend higher in the food services and drinking places, health care, and social assistance sectors, although the retail sector lost jobs.

Meanwhile, the Labor Department said the unemployment rate edged down to 4.4 percent in December from a revised 4.5 percent in November.

The unemployment rate was expected to slip to 4.5 percent from the 4.6 percent originally reported for the previous month.

The dip by the unemployment rate came as the household survey measure of employment jumped by 232,000 persons, while the labor force shrank by 46,000 persons.

The report also said average hourly employee earnings climbed by $0.12 or 0.3 percent to $37.02 in December.

Average hourly employee earnings in December were up by 3.8 percent compared to the same month a year ago, reflecting an acceleration from 3.6 percent in November.

"The dip in the unemployment rate and the respectable wage growth story offers some mitigation, but the jobs market has undoubtedly cooled through 2025," said ING Chief international Economist James Knightley.

"With monetary policy still described as modestly restrictive, it justifies further gradual rate cuts," he added. "However, we anticipate that next week's CPI report could be a little hot, so there is little prospect of action ahead of the March FOMC meeting."