US employers went on hiring spree in December

Associated Press

WASHINGTON

U.S. employers went on a hiring spree in December, adding a surprising 312,000 jobs and providing a dose of reassurance about the economy after a turbulent few months on Wall Street.

The job gains reported Friday by the Labor Department came despite a trade war with China, a global slowdown and a partial government shutdown now entering its third week.

The nation’s unemployment rate rose slightly to 3.9 percent last month, but that, too, was considered a positive sign, reflecting an increase in Americans beginning to look for work. And average hourly pay improved 3.2 percent from a year ago.

President Donald Trump called the job growth “GREAT” on Twitter.

The torrid hiring in December far outstripped the 180,000 jobs investors had been anticipating and could help ease fears that the economy’s expansion – now in the middle of its 10th year – may be coming to an end.

“The labor market is very strong even though the economy appears to be slowing,” said Eric Winograd, senior U.S. economist at the investment management firm AllianceBernstein. “Those two things cannot coexist for very long. Either weakening demand will lead firms to dial back the pace of hiring or the robust pace of hiring will lead firms to ramp back up production.”

The strong job growth suggests employers believe U.S. consumer spending will stay robust.

Health care and education added 82,000 jobs, the largest jump in nearly nine years. Restaurants and drinking places posted a net gain of 40,700 jobs. Builders added 38,000 jobs; manufacturers increased their payrolls by 32,000 workers. And, businesses are still searching for more workers.

Still, Kevin Hassett, chairman of the White House Council of Economic Advisers, cautioned on Thursday that the jobs report for January could be weak if the shutdown continues. Job totals could be lowered by hundreds of thousands of government employees being temporarily put out of work.

In 2018, employers added 2.6 million jobs, or an average of nearly 220,000 a month, according to the Labor Department.

At some point, even if the economy remains healthy, monthly job gains will likely downshift to a more gradual pace because of a dwindling pool of unemployed people. There were 6.3 million people looking for a job in December, down from 6.5 million a year ago.

“People should not get used to numbers like the one we saw this month,” said Martha Gimbel, director of economic research at the jobs site Indeed. “Eventually, job growth is going to start slowing down. When that happens, we shouldn’t panic.”