WASHINGTON — The U.S. economy created a burst of new jobs in December, capping a solid year of employment growth marked by big gains in healthcare and government payrolls, according to new figures released Friday.
The 256,000 jobs added last month was the most since March and far exceeded analysts’ expectations. The nation’s jobless rate edged down to 4.1% from 4.2% in November.
The surprisingly strong employment report, however, wasn’t welcomed on Wall Street. Stocks fell at the opening bell as investors considered it even more likely now that the Federal Reserve will halt cutting interest rates. Since September the Fed has lowered borrowing costs at three straight meetings as inflation had trended down from previous highs. Fed policymakers next meet at the end of this month.
For Main Street, Friday’s jobs report is about as good as it gets. Most sectors added jobs. And average hourly earnings for all private employees rose at an annual rate of 3.9%, more than a percentage point higher than the latest inflation rate.
Although the U.S. labor market remains solid, separate government and private sector reports show there are fewer job openings today than a year ago. And workers have become more cautious about leaving their jobs. Layoffs overall have remained low.
Surveys indicate that business leaders are generally optimistic about hiring prospects in the coming months, expecting that the incoming Trump administration will cut taxes and regulations.
At the same time, many people are concerned that President-elect Donald Trump’s plans to increase tariffs broadly and deport millions of workers without proper documentation will spur inflation and hurt economic growth.
What’s clear is that Trump will inherit an economy that has been very resilient.
According to Friday’s report from the Bureau of Labor Statistics, the U.S. economy added 2.2 million jobs last year, compared with 3 million in 2023. However, job statistics for last year are expected to be revised down significantly when annual revisions are reported in March.
California’s job growth this year has lagged behind the nation’s, in large part because of layoffs at tech firms and weakness in manufacturing and the information sector, which includes the film industry.
The state’s jobs report for December will be released Jan. 24. California’s unemployment rate in November was 5.4%, up from 5.2% at the start of last year.
