Total nonfarm payroll employment increased by 256,000 in December, and the unemployment rate changed little at 4.1%, the U.S. Bureau of Labor Statistics reported December 10. Employment trended up in healthcare, government and social assistance. Retail trade added jobs in December, following a job loss in November.
The unemployment rate changed little at 4.1% in December. After increasing earlier in the year, the unemployment rate has been either 4.1% or 4.2% for the past seven months. The number of unemployed people, at 6.9 million, also changed little in December.
Bright MLS Chief Economist Lisa Sturtevant had the following to say about the report:
“Average earnings increased by 3.9% on an annual basis, which is faster than the overall rate of inflation. While higher prices have weighed on consumers’ minds, the fact that wages continue to rise faster than inflation suggests that many individuals and families—including prospective homebuyers—are still feeling relatively confident about their financial situations.
“Today’s jobs report comes as President-elect Trump gets ready to take office. He begins his administration with a very strong labor market, though there are potential headwinds. The Federal Reserve has indicated that inflation could be a growing concern in 2025. Proposed policies from the incoming administration, including those related to tariffs and immigration, could have inflationary impacts, possibly leading to cooling job growth.
“When it comes to how labor market trends affect the housing market in 2025, it is not just how many jobs are being added and how wages are trending, but it is also about where workers will do those jobs. With more employers calling workers back to the office full-time, prospective homebuyers are going to have different priorities. In a nationwide survey conducted in December, we found that the single most important neighborhood consideration for buyers in 2025 was the commute or the distance to their job.”
Realtor.com® Chief Economist Danielle Hale had these thoughts:
“Although we’ve rung in the new year and cleared the confetti and champagne glasses, the next month or so of data will help close out our picture of 2024 and shape actual conditions and expectations for the year ahead. The labor market ended the year on a steady note, largely in line with or exceeding expectations. This should bolster confidence in monetary policy, but suggests, as markets and the Fed have come to expect, that not as much additional monetary easing is needed. Mortgage rates, which have climbed recently, have largely priced in this reality, but policy remains a wild card as inauguration nears.
“Ongoing wage growth will be important for home shoppers, especially first-time homebuyers who generally do not have equity from a previous home to use and tend to rely on savings, generally accumulated from earnings. Those ready to make a purchase in 2025 will find pockets of opportunity in areas like Harrisburg, Pennsylvania, which joined nine other markets in the Northeast, Midwest and South.”
Among the major worker groups, the unemployment rate for Whites (3.6%) edged down in December. The jobless rates for adult men (3.7%), adult women (3.8%), teenagers (12.4%), Blacks (6.1%), Asians (3.5%) and Hispanics (5.1%) changed little over the month.
Among the unemployed, the number of permanent job losers declined by 164,000 to 1.7 million in December but is little different from a year earlier. The number of people on temporary layoff, at 862,000, changed little over the month and over the year.
In December, the number of long-term unemployed (those jobless for 27 weeks or more) changed little at 1.6 million but is up by 278,000 from a year earlier. The long-term unemployed accounted for 22.4% of all unemployed people in December.
The labor force participation rate, at 62.5%, was unchanged over the month and has remained in a narrow range of 62.5% to 62.7% since December 2023. The employment-population ratio, at 60%, changed little over the month and over the year.
The number of people employed part-time for economic reasons, at 4.4 million, changed little in December and is little different from a year earlier. These individuals would have preferred full-time employment but were working part-time because their hours had been reduced or they were unable to find full-time jobs.
