This archive report was first published on 10 January 2020.
December Jobs Report: Key Takeaways ¶
The Labor Department will release the December jobs report on Friday, providing a clearer reading of the economy and helping to explain whether November's unusually exuberant gains were a one-off or the start of a trend.
According to economists, the unemployment rate is expected to remain unchanged at 3.5 percent, while average hourly earnings are predicted to rise by 0.3 percent, bringing the year-over-year increase to 3 percent.
Analysts are paying close attention to the report, particularly in light of the six-week strike by 49,000 General Motors workers in October and November, which clouded the previous two months' figures.
"The big story of 2019 was the slowdown from 2018 in payroll growth," said Nick Bunker, an economist at Indeed. "I just want to see whether we're going to head into 2020 with a bit more momentum."
Manufacturing Sector in Focus ¶
The government reported this week that the number of new people filing for unemployment benefits dipped, a figure that remains at historically low levels.
However, Andy Challenger, vice president of Challenger, Gray & Christmas, an outplacement firm that tracks layoff announcements, said that "overall the job cuts we saw in 2019 were fairly high, higher than you would expect."
Industrial goods and automobile manufacturers were among the hardest hit, with a weakening manufacturing sector being a persistent concern throughout last year.
"Uncertainty around trade has been a serious complication," Mr. Challenger said. "It's hard for these manufacturers to make decisions around long-term planning when they don't know what their cost structure is going to be. And there's still changes to come."
Wage Growth Disappoints ¶
The labor squeeze has helped workers at the lowest end of the pay scale, pushing wage increases above the overall average.
However, spiritless wage growth has been one of the more disappointing story lines of 2019, with average year-over-year raises failing to match the 3.4 percent peak reached in February.
"We saw an acceleration of wage growth in 2018, but then it stalled out in 2019," Mr. Bunker of Indeed said. "Average wage growth was fairly tepid."
Revisions Ahead ¶
The Labor Department's report is based on two monthly surveys, one of employers and the other of households.
However, economists are continually updating their results, and Friday's report takes account of some very minor adjustments.
Much more prominent revisions, though, are scheduled to be released next month, when the government publishes its annual update of payroll gains.
