Economy Watch: U.S. Economy Creates 156K Jobs in December

While job creation was below average for the month, wages grew more in December than at any time in the last nine years.
Source: U.S. Bureau of Labor Statistics
Source: U.S. Bureau of Labor Statistics

The U.S. economy created more jobs again in December, a net of 156,000, the Bureau of Labor Statistics reported on Friday. That was fewer than expected, and fewer than the average per month of the past three months, which was 165,000. Even so, the report was generally good, especially since the BLS also reported that wages grew more during the month than at any time since the beginning of the recession nine years ago.

Stagnant wages have long been a sore spot for workers. Employment might not quite be “full” now, but at least the job market seems to be putting upward pressure on wages. In December, average hourly earnings for all employees on private payrolls increased by 10 cents to $26.00, after edging down by 2 cents in November, the bureau noted. Over the year, average hourly earnings have risen by 2.9 percent, somewhat ahead of inflation.

There were job increases in a number of sectors that tend to spur real estate absorption, though one of the main office drivers–employment in professional and business services–only increased by a net of 15,000 jobs in December, following an increase of 65,000 in November. That sector added 522,000 jobs in 2016. On the other hand, employment in financial activities continued on an upward trend in December (up 13,000). That’s roughly in line with the average monthly gains for the industry over the past two years.

The headline unemployment rate (U-3) was 4.7 percent in December, reported the BLS, edging up a tenth of a percentage point for the month, presumably because more people are now looking for work. The bureau’s more expansive definition of unemployment, which it calls U-6–”total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons”–was 9.2 percent in December, down a tenth of a percentage point. A year ago, the U-6 was 9.9 percent.