U.S. Job Growth Far Exceeds Estimates In December

(RTTNews) - A closely watched report released by the Labor Department on Friday showed employment in the U.S. increased by much more than expected in the month of December.

The Labor Department said non-farm payroll employment surged by 256,000 jobs in December after jumping by a downwardly revised 212,000 jobs in November.

Economists had expected employment to climb by 160,000 jobs compared to the addition of 227,000 jobs originally reported for the previous month.

The stronger-than-expected job growth partly reflected notable increases in employment in the healthcare and social assistance and leisure and hospitality sectors as well as a rebound by employment in the retail sector.

The report also said the unemployment rate edged down to 4.1 percent in December from 4.2 percent in November. Economists had expected the unemployment rate to come in unchanged.

The unexpected dip by the unemployment rate came as the household survey measure of employment spiked by 478,000 persons, outpacing a 243,000-person jump in the size of the labor force.

"The robust December employment report is another piece of economic data that suggests the Federal Reserve will move to the sidelines for a while; we foresee them keeping rates steady throughout the first half of the year," said Nationwide Chief Economist Kathy Bostjancic.

She added, "The combination of the strength in the labor market, recent stalling in the disinflationary trend in inflation, and the prospect of changes in tariff and immigration policies that could push inflation higher will keep the Fed cautious and patient with regards to cutting rates further."

The Labor Department also said average hourly employee earnings climbed by $0.10 or 0.3 percent to $35.66 in December. The annual rate of wage growth slowed to 3.9 percent in December from 4.0 percent in November.