U.S. jobs growth surged unexpectedly in December as the Bureau of Labour Statistics reported that the U.S. economy added 216,000 jobs in December, ahead of November’s 199,000 new jobs.
The number of jobs far exceeded economists’ expectations of 170,000 during the month. This marks another strong month for a labour market that never delivered the layoffs economists expected in 2023.
According to the Bureau of Labour Statistics, the unemployment rate stood at 3.7%. As of December, the labour market added more than 2.7 million jobs in 2023, with a monthly average of 225,000 jobs. The unemployment rate has now remained below 4% for more than two years, a feat that was last accomplished in the 1960s.
Callie Cox, U.S. investment analyst at eToro said, “The totality of the data shows that the job market is still staggeringly strong, especially when you consider the pressure on the economy.” “But this particular report may not be good enough to please a market that’s obsessed with the idea of rate cuts.”
While wage growth is good news for labourers and workers, Cox claimed that it could pose obstacles in the fight against inflation, as this month’s growth was the first time wages increased in the past five months. Higher prices can ultimately raise the costs of goods and services as manufacturers need to raise prices to cover increased labour costs.
Chris Zacaarelli, Chief Investment Officer for Independent Advisor Alliance said, “We got a bit of a shocker today with the job market showing much more signs of strength, and not cooling at all.”
Key Takeaways
- The U.S. economy added more than 216,000 jobs in December, exceeding economists’ expectations of 170,000 new jobs and ahead of November’s 199,000 jobs gain.
- The unemployment rate stood at 3.7%. The rate has been maintained below 4% for more than 2 years, a streak that was last accomplished in the 1960s.
- Federal Reserve members have been closely monitoring employment data to determine when interest rate cuts are needed.
