After a revised gain of 4,000 jobs in November — the first monthly employment increase in two years — payrolls ended the year down, falling by 85,000 in December according to today’s Labor Department report, while the unemployment rate held steady at 10 percent.
The December report was a mixed bag. While the revised jobs gain in November was encouraging, it would be a mistake to assume that private sector full-time employment is finally on the mend. The gain in November was due entirely to increases in government and temporary employment. Outside of these two areas, payrolls were cut by 55,000 in November and by 110,500 last month.
While overall labor market conditions soured in December, some positive developments did take place. First, temporary employment increased for a fifth consecutive month, an early indication that companies are needing to expand worker-hours in response to rising demand. Second, the decline of 27,000 jobs in manufacturing employment was the shallowest drop in two years. Still, just six of the 19 major manufacturing industries actually increased employment last month.
While today’s report shows that overall economic conditions have improved from the beginning of the year, these numbers still indicate that the economy is still in a fragile state, and manufacturers are still struggling and facing many uncertainties ahead.