Experts had been anticipating U.S. employers to add a healthy number of jobs in December, while recognizing that below the surface monthly hiring gains were concentrated in a handful of sectors. December’s Bureau of Labor Statistics (BLS) Employment Situation Summary data did not disappoint the analysts. Total nonfarm payroll employment increased by 256,000 in December with growth concentrated in the same sectors.
The unemployment rate changed little at 4.1 percent. After increasing earlier in the year, the unemployment rate has been either 4.1 percent or 4.2 percent for the past 7 months. The number of unemployed people, at 6.9 million, also changed little in December.
“The new year promises to be an eventful period in the executive, technical, professional and managerial employment world that our HireQuest Inc. divisions of over 425 offices operate in every day. The obvious primary driver is a new administration with a focus on creating conditions they see driving business investment and economic and job growth. From deregulation to unleashed energy production and technological innovation, improved government efficiency, and a tax environment to encourage investment, the Trump economic team hopes to accelerate long-term growth.
A second factor is a dynamic that our MRINetwork and Snelling professionals deal with almost daily in consultations with clients and top candidates – a move to a final resolution of the work-from-home phenomena,” noted Rick Hermanns, president and chief executive officer of HireQuest Inc.
“We anticipate an acceleration in WFH workplace turmoil over the next several months as employees hope that a hot labor market provides leverage to pressure firms to resist back-to-office mandates. And we hear quite clearly, though still confidentially, from our “C” level clients that they are convinced productivity and positive corporate culture will best thrive in a traditional work environment. Wall Street Journal columnist Callum Borchers continues to have an excellent handle on both sides of the debate. His recent ‘On The Clock’ reporting captures both sides of this evolving story.”
Goldman Sachs, while underestimating December job growth totals, correctly categorized the overall sectors generating increases, “Our forecast reflects a rebound in the labor force participation rate and middling household employment growth amid more challenging job-finding prospects. We expect deceleration in job growth in non-retail sectors, particularly professional services and construction, to more than offset stronger retail hiring this month.”
Paul Kiernan reporting for The Wall Street Journal also noted the sectors driving growth through much of 2024, “Hiring was driven by the same sectors that have powered the labor market all year—healthcare, social assistance, government and leisure and hospitality. The economy also added 43,000 retail jobs, as a late Thanksgiving likely pushed some holiday hiring from November to December. He further characterized full year 2024 results, “The U.S. added more than 2 million jobs in 2024. That was more than double the number expected by economists heading into the year, according to a Wall Street Journal survey conducted last January.”
Key industries reported the following trends in December 2024:
Healthcare added 46,000 jobs in December, with gains in home healthcare services (+15,000), nursing and residential care facilities (+14,000), and hospitals (+12,000). Healthcare added an average of 57,000 jobs per month in 2024, the same as the average monthly gain in 2023.
Retail trade added 43,000 jobs in December, following a loss of 29,000 jobs in November. Notably, building material and garden equipment and supplies dealers lost jobs (-11,000) in the month. Overall, employment in retail trade changed little in 2024, following an average monthly increase of 10,000 in 2023.
Employment in leisure and hospitality increased in December (+43,000). Leisure and hospitality added an average of 24,000 jobs per month in 2024, about half the average monthly gain of 47,000 in 2023.
Government employment continued to trend up in December (+33,000). Government added an average of 37,000 jobs per month in 2024. Additionally, employment continued to trend up in state government (+10,000). In a related sector, employment in social assistance increased by 23,000 in December versus an average gain of 18,000 jobs per month in 2024.
Continuing a year-long trend, employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; transportation and warehousing; information; financial activities; professional and business services; and other services.
“Our entire HireQuest family of companies look forward to an exciting new year as we continue to provide both skilled professionals and leading organizations with the talent, insights and proactive counsel they need to grow in a rapidly evolving workplace. I personally remain agnostic as the remote work debate continues and as organizations seek the best path forward. A critical caution I do offer is a concern for those workers in the opening phase of their careers. In those formative years, people are not only learning their industry and their company but need to be identifying and working with mentors who can drive long-term career performance. A daunting task in a pure work from home environment,” noted Hermanns.