Report: Lackluster December jobs numbers reflect tight labor market
- The private sector created 153,000 jobs in December — far fewer than the 170,000 expected, reports CNBC, citing an analysis from ADP and Moody's Analytics. The December figure is significantly lower than the November total of 215,000. The report concludes that the labor market has continued to tighten and that job gains could remain weak in the months ahead.
- Jobs in the service economy showed the most growth, totaling 169,000 added positions for the month. However, goods producers cut a net 16,000 jobs; 9,000 came from manufacturing, 5,000 from natural resources/mining and 2,000 from construction.
- Midsize firms with 50 to 599 employees had the biggest job gains of the month, adding 71,000 to the economy. Large firms added 63,000 jobs, with those employing 1,000 or more workers gaining the most.
Mark Zandi, Moody's Analytics’ chief economist, told CNBC the economy is growing, although slowly. He noted that small companies are struggling to make payroll in this economy.
That’s a troubling sign. Small companies are the forerunners and the largest segment of all U.S. companies. The report shows that employers with fewer than 50 workers added only 18,000 jobs. Those with fewer than 20 employees cut 3,000 jobs from their payrolls.
The report also shows that first-time unemployment claims fell to a 43-year low in December. But economists are predicting a slight increase in the unemployment rate from 4.6% to 4.7 %. Outplacement firm Challenger, Gray & Christmas says that U.S.-based employers plan to cut 33,627 jobs. Employers will need to wait for January’s jobs report to see if the economy continues to grow despite December’s setbacks.
- CNBC US private sector created 153K jobs in December, vs 170K expected: ADP
- Challenger, Gray & Christmas Job Cut Report
- ADP and Moody's Analytics United States: ADP National Employment Report