US economy creates a modest 156,000 jobs in December

Tribune Washington Bureau (TNS)

Job growth slowed at the end of last year while the unemployment rate ticked higher – signs that the tight labor market is resulting in diminished hiring even as it is pushing wages higher.

The U.S. economy added 156,000 net new jobs last month, down from an upwardly revised 204,000 created in November, the Labor Department said today.

The jobless rate closed out the year at 4.7 percent, up from 4.6 percent, but still the lowest for a December since 2006.

Average wages for all private-sector workers rose at the fastest annual pace since 2009, increasing 2.9 percent, led by sharp gains in the high-end information sector and the lower-paying hotel and restaurant business.

“With wage growth climbing again, the modest drop-off in employment growth won’t stop the Fed from tightening monetary policy again this year,” said Paul Ashworth of Capital Economics, referring to the Federal Reserve’s plans for increasing interest rates in the coming months.

The report suggests that the nation’s job market remains solid, although a slowdown in hiring is expected after seven straight years of job growth. The economy added an average 229,000 jobs a month in 2015 and 251,000 in 2014.

President-elect Donald Trump has pledged to boost the nation’s modest pace of economic growth with changes in tax policy, business regulations and infrastructure spending. But he faces an economy that is at or close to full employment in which it will be increasingly hard to keep up a high rate of job growth.