U.S. Employment Unexpectedly Decreases By 140,000 Jobs In December

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After reporting slowing job growth over the past few months, the Labor Department released a report on Friday unexpectedly showing a decrease in U.S. employment in the month of December.

The Labor Department said non-farm payroll employment fell by 140,000 jobs in December after climbing by an upwardly revised 336,000 jobs in November.

The decline surprised economists, who had expected employment to increase by about 71,000 jobs compared to the addition of 245,000 jobs originally reported for the previous month.

Employment decreased for the first time since April as the recent surge in coronavirus cases led to a nosedive in employment in the leisure and hospitality sector, which lost 498,000 jobs.

Private education employment also declined, while the job losses were partially offset by gains in professional and business services, retail trade, and construction.

Meanwhile, the report said the unemployment rate came in at 6.7 percent in December, unchanged from November. Economists had expected the unemployment rate to inch up to 6.8 percent.

The unemployment rate came in unchanged as the labor force inched up by 31,000 persons compared to a 21,000 person uptick in the household survey of employment.

The report said average hourly employee earnings climbed $0.23 or 0.8 percent to $29.81. Annual wage growth jumped to 5.1 percent in December from 4.4 percent in November.

“Looking ahead, continued restrictions on dining could see payrolls fall further in January,” said Michael Pearce, Senior U.S. Economist at Capital Economics.

He added, “But, with the high-frequency indicators suggesting that the rest of the economy is still holding up and additional fiscal stimulus starting to feed through, we expect first-quarter GDP growth to be positive.”

The material has been provided by InstaForex Company – www.instaforex.com

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