The December jobs report is out, and it’s smashed the moderate expectations that economists had for it. Figures released by the Labor Department on Friday morning show that the economy added 292,000 jobs in December, and the unemployment rate remained at 5 percent.
The average monthly growth in non-farm jobs in 2014 was 260,000; with the December jobs report, the 2015 average comes in at 221,000—which counts as a slowdown, but still makes 2015 one of the best years for U.S. job growth since 1999.
The fantastic October jobs report has been revised up (again) to 307,000 jobs added, making October the strongest month for job growth in 2015. November’s numbers have been revised up too, to 252,000. Combined, the job gains of those two months are 50,000 more than previously reported. Together with December’s numbers, that marks the best three-month stretch for job growth in 2015.
Meanwhile, the unemployment rate stayed steady at 5 percent, where economists expect it to remain. The U.S. unemployment rate has not dipped below that level since 2007.
Friday’s report was not all good news. Wages are relatively low, a grim finding that’s been a theme of recent jobs reports. In 2015, average hourly earnings only grew by 2.5 percent, whereas the Fed would consider a rate of 3.5 percent healthy. Fed officials and economists have been looking hard for signs of wage growth and not finding it, but there’s hope that a tightening labor market would mean a bigger payday for workers.
There were other weak points. Labor-force participation remained low in December as well, and though the report shows it perked up very slightly to 62.6 percent, it’s still at the lowest level since 1977. Another consistent worry has been that so many Americans are working part-time because they can’t find full-time positions. This year, those are three areas that economists will be looking at closely for signs of improvement. With interest rates already up, 2016 is set to be another test of a tentative economic recovery.