US economy adds 148,000 jobs in December
Friday, January 05, 2018
U.S. employment grew 148,000 nonfarm jobs in December, while the jobless rate remained at 4.1 percent for the third straight month, the lowest rate since 2000, the Bureau of Labor Statistics reported. Job gains in construction, healthcare and manufacturing led the way.
In December 2017, there were 6.6 million unemployed workers versus 7.2 million in December 2016. Jobless rates for major worker sectors remained relatively constant in December: adult men (3.8 percent), adult women (3.7 percent), whites (3.7 percent), blacks (6.8 percent), Asians (2.3 percent) and Hispanics (4.9 percent).
"The continued strong pace of job growth pushed down the unemployment rate for African-Americans to 6.8 percent, the lowest figure since these data began being collected in 1972," according to Dean Baker, senior economist at the Center for Economic and Policy Research in Washington, DC. "By comparison, the African-American rate bottomed out at 7.0 percent in April of 2000. This is yet another example of how a low unemployment rate disproportionately benefits the most disadvantaged segments of society."
Long-term unemployment (27 weeks or more) was 1.5 million in December, or 22.9 percent of jobless workers versus 1.6 million in November (23.8 percent of jobless workers). Between December 2016 and December 2017, the number of long-term unemployed fell 354,000. Payroll jobs increased 2.1 million in 2017 versus 2.2 million in 2016, the BLS reports.
The employment-to-population ratio stayed at 60.1 percent in December, identical to November This metric measures the ratio of the labor force now on payrolls to the total working-age population.
Small businesses of 1-49 employees added 94,000 jobs in December, versus 50,000 jobs in November, according to the ADP National Employment Report. Firms of 50-499 workers increased payrolls by 100,000 jobs in December, compared with 99,000 jobs in November. Large companies with 499-plus employees hired 56,000 workers in December, versus 41,000 in November.
"We've seen yet another month where the labor market has shown no signs of slowing," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "Looking at company size, small businesses finished out 2017 on a high note adding more than double their monthly average for the past six months."
ADP's employment report comes from ADP's actual payroll data. The BLS employment data is derived from two sources: the household survey and the establishment, or business, survey.
In the ADP report by sector, service employment took the lead with 222,000 new jobs. Within that sector, the top employment creator was professional and business services with 72,000 jobs, followed by education/health services, adding 50,000 jobs in December.
The goods-producing sector added 28,000 jobs in December. Construction jobs grew 16,000, followed by manufacturing at 9,000 and mining at 3,000.
"The job market ended the year strongly," said Mark Zandi, chief economist of Moody's Analytics. "Robust Christmas sales prompted retailers and delivery services to add to their payrolls."
This employment report could suggest storm clouds ahead, according to Zandi.
"The tight labor market will get even tighter, raising the specter that it will overheat," he said.
For instance, a further drop in the unemployment rate from 4.1 percent could spur the Federal Reserve Bank to raise interest rates. However, The Wall Street Journal is reporting such a labor market scenario is not on the near horizon.
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