WASHINGTON – The U.S. economy added 312,000 jobs in December, smashing expectations for year-end growth, and the unemployment rate crept up to 3.9 percent – the highest level since July, federal economists reported Friday.
Wages grew 3.2 percent in the year since December 2017 after nearly a decade of tepid growth, the Labor Department’s latest numbers showed.
The slightly higher jobless rate shouldn’t ring alarm bells, said Joseph Brusuelas, chief economist at RSM, an international consulting firm. Some 400,000 more people were looking for work last month.
“You’re bringing people back into the labor force,” he said. “That’s a good thing.”
Altogether, 2018 was the best year for job creation since 2015. The economy added 2.6 million jobs, and the year ended with a slightly higher labor participation rate, too: 63.1 percent of Americans were working or looking for jobs in December, up from November’s 62.9 percent.
The December numbers follow a year of steady growth across industries – particularly manufacturing, which had its biggest boost in about a decade. There were some exceptions, including retail and food services.
And economists caution that the pace of hiring overall is expected to slow in 2019.
At this stage of the nine-year recovery, maintaining the streak that took off in 2014 is projected to become increasingly difficult. Trade tensions with China and other countries could accelerate this slowdown, since President Trump’s tariffs are raising the cost of doing business worldwide.
Those uncertainties are already playing out in the volatile stock market, but so far America’s labor market has remained robust.
Manufacturing, health care, retail and construction led December’s growth.
