What you need to know
- Employers in the United States likely created 153,000 jobs during December. That’s close to average for the past six months. At the same time, unemployment rates likely remained at the relatively low level of 4.2%.
- Job growth is slowing down since the end of post-pandemic boom, but it has not stalled.
- The trajectory of the job market over the next year is uncertain and could depend on incoming president Donald Trump's policy decisions.
Continue the recent trend and you can expect that U.S. jobs will continue to grow steadily in 2024.
Bloomberg Finance reported that Wells Fargo Economics’ consensus report indicates the Bureau of Labor Statistics will release its labor market report this Friday. It is likely to show the U.S. added 153,000 positions in December. This is less than the 227,000 new jobs created in December, but a bit more than the average of 143,000 added jobs over the last six months. Forecasters predict that the unemployment rate will remain at 4,2%. This is a historically low level.
This is slower than the pace at which jobs were created in the early post-pandemic years, when the job market was much more active and the COVID-19 economic recession had just ended. High borrowing costs for loans—a result of the Federal Reserve’s campaign of interest rate hikes meant to curb inflation since 2022—have discouraged borrowing and spending and thrown some sand in the gears of the job market.
What's Ahead for the Job Market?
Some economists believe the employment market will bounce back by 2025. Others predict an ongoing slowdown.
Economic predictions always come with a grain of salt, and perhaps more so this year, given the uncertainties about the policies of the second Trump administration. It is possible that the future of the economy will be determined by the degree to which Trump implements the tariffs he has promised during the election campaign.
At least for now, however, economists believe that the current job market is stable. Employers are not hiring in large numbers, but neither are they laying off workers in mass.
“Employers, scarred by the post-pandemic labor shortage and aware that the days of ample labor supply are likely over, tell me they don’t want to get caught short workers again,” Thomas Barkin said this in an address on Friday. “As a result, while cautious employers are allowing headcount to drift downward through attrition and reduced hiring, they are slow to reduce staff. The layoff rate remains near historic lows. A low hiring, low firing labor market is still a healthy one.”
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