December payroll employment turned out to be less than expected, but it looks like everyone is taking it in a stride. The lowdown, and some reaction, from CNNmoney:
The pace of hiring picked up in December, according to a government report Friday that still came in slightly weaker than Wall Street expectations.
The closely watched Labor Department report showed a seasonally adjusted 157,000 jobs added to U.S. payrolls in the month, up from the a revised 137,000 added in November, according to the report. Economists surveyed by Briefing.com forecast that there would be 175,000 jobs added in the month.
The unemployment rate remained at 5.4 percent, the same as in November and in line with economists' forecasts.
On the other hand:
The November payroll number was revised 25,000 higher from the earlier report, so the resulting payroll number is roughly in line with where economists exected the December reading to fall. That seemed to convince investors that the Federal Reserve is likely to stay the course of interest rate hikes going forward. Bond prices rose, and yields fell, immediately after the report, then returned near their pre-report levels.
This willingness to see the glass as half full seems to be the rule. From Rueters:
"The revision washed out the slight negative surprise," said Greg Anderson, a currency strategist with ABN AMRO in Chicago...
"Overall, compared to the previous year, it looks great, it just keeps going stronger and stronger and I expect that to be the case this year," said economist Kurt Karl of Swiss Re in New York.
Lisa Finstrom, a currency analyst with Citibank in New York, said the employment data were consistent with a market expectation of rising interest rates.
"People were looking at 150,000 jobs per month as a good pace of job creation for the economy," Finstrom said. "We're sticking near that area. So the Fed continues tightening."
And this, from Bloomberg:
Employment growth is "pretty good,'' said Stephen Stanley, chief economist at RBS Greenwich Capital in Greenwich, Connecticut. ``Business caution is starting to recede, and we're not as worried about oil prices, so I expect corporations to open the purse strings a bit in 2005.'' Stanley predicted 150,000 job gains for December and forecasts about 200,000 a month this year.
“Looking at the data in recent months there does appear to have been a pick-up in the underlying trend compared to the blip lower we saw in the third quarter,” said Ian Gunner at Mellon Financial.
If you want to take a make a judgment on the trend yourself, here's a picture of the recent jobs record, courtesy of the CMMmoney link above.
