In November, the BLS initially said the economy added 211,000 jobs – a “healthy pace”, as NPR’s Marilyn Geewax put it. The Fed’s 10-member voting committee said in meeting minutes released this week that the labor market, though still shy of its full potential, showed “further improvement” and “confirmed that underutilization of labor resources had diminished appreciably since early this year”. “If President Obama wants to make a real difference during his previous year in office, he’ll use his final State of the Union Address to propose new ways to break down barriers to job creation and encourage economic growth”.
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However, not all economists agree.
“This should allay worries that the US economy will be derailed by the troubles in China and the rest of the emerging markets”, said Mark Zandi, chief economist for Moody’s Analytics. The jobless rate was unchanged from November despite the hiring surge because 466,000 workers returned to the labor force. Last month, it held steady at 5 percent.
The labour-force participation rate ticked up 0.1 percentage points to 62.6%.
Average hourly earnings, meanwhile, fell slightly last month to $25.24, although they grew 2.5 percent between January and December.
The rate has lodged there for the third month in a row.
“A meaningful pickup in wage growth is still the missing piece of the puzzle in this recovery”, said Paul Ashworth, economist at Capital Economics. Overall, industries did not fare as well in 2015 compared to 2014, but industries like Mining (which includes oil and gas industries beset by low prices for oil) dragged employment growth in 2015. Still, average pay has risen 2.5 percent in the past year, only the second time since the Great Recession ended in mid-2009 that it’s reached that level.
For months, US employers have hired steadily even as global growth has flagged and financial markets have sunk.
Job growth in the USA in December outstripped economists’ forecasts, although hourly wages again lagged behind projections. The bulk of new jobs in the US are in health care, retail and professional services, which are more shielded from the global economy, analysts say. That means the economy was creating jobs at an unexpectedly strong pace throughout the last quarter of 2015.
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Last month, the Federal Reserve took action to raise interest rates and signaled its intention to raise them a few more times this year. It’s an interesting situation-although the economy was once the crux of the public’s frustration with Obama, now that he has demonstrated his policies do indeed work, it no longer feels so important to individuals who once criticized his economic ideas so strongly. The domestic sector continues to power job growth. After all, the headline unemployment rate is holding at a low 5%. There were 1,646,000 more individuals not in the labor force in 2015 than there was in the year prior. And cheaper oil has already caused sharp cutbacks in US drilling jobs.
