by Dan Burrows | January 10, 2014 9:18 am
The December jobs report showed a surprisingly sour turn in the labor market last month, with job growth slowing to a three-year low even as the unemployment rate posted an unexpected decline.
Nonfarm payrolls expanded by only 74,000 last month, the Department of Labor said Friday, far short of the forecast for 197,000 new jobs.
In a sliver of solace, the November jobs report figure was revised up to 241,000 from 203,000. However, December’s reading breaks a two-month trend in which employers added at least 200,000 workers.
The unemployment rate, which is derived from a separate survey, fell to 6.7% from 7% a month ago. However, the decline in the rate was driven by people dropping out of the labor force rather than job growth.
The latest jobs report was shockingly weak. Prior to the latest reading, it appeared that job creation was accelerating sharply. But now that the books are closed on 2013, it’s clear that the job market gained no momentum year-to-year. For all of 2013, the labor market added an average of 182,000 jobs a month, vs. 183,000 a month in 2012.
However, as always, whether folks actually landed jobs greatly depended on the industry they were targeting.
Drilling down into the Bureau of Labor Statistics’ December Employment Situation Report showed areas of strength in retail trade, wholesale trade, and business and professional services.
Thanks to the holiday selling season, the best place for job seekers last month was in retail, which added more than 55,000 new positions. Areas of strength included employment among food and beverage stores, clothing and accessories stores, and motor vehicle parts and dealers. Retail trade added an average of new 32,000 jobs a month in 2013, the Labor Department said.
The wholesale trade industry added 15,400 jobs, led by electronic markets and agents and brokers. The industry gained an average of 8,000 jobs a month last year.
Professional and business services continued to improve, creating 19,000 net jobs. Top areas for job seekers included temporary help services, which added 40,000 jobs last month.
Manufacturing also continued to hire new workers, as employment grew by 9,000 in December. Primary metals and petroleum and coal products were areas of strength for job-seekers.
On the other side of the jobs report ledger, unusually cold weather led the construction industry to shed workers last month, cutting payrolls by 16,000. For the full year, construction gained an average of 10,000 jobs a month.
Employment in the information industry fell by 12,000 in December, driven by job losses in the motion picture and sound recording industry. For 2013, employment in the industry was essentially unchanged year-over-year.
Healthcare was a wildly unusual decliner — healthcare and social assistance jobs declined by 1,000. This morning, The Atlantic’s Derek Thompson tweeted, “Health care jobs fell in December for the first time in *at least* 23 years. That’s where FRED data ends.”
Within the otherwise strong business and professional services were pockets of weakness. Accounting and bookkeeping services saw payrolls decline by nearly 25,000 in the last month of the year.
Major industries like transportation and warehousing, financial activities, leisure and hospitality posted little change in December payrolls.
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