- Mark Zandi, chief economist at Moody's Analytics
The US economy created 292,000 jobs in December, in line with analysts' expectations for solid and steady growth. The Labor Department revised the previous two months data, saying that the economy added a net 50,000 new jobs more than initially reported. November payrolls were up 252,000, while the October gain was 307,000. The unemployment rate stayed at 5% last month, while average hourly wages remained flat. The jobless rate, which has dropped since hitting the 10% mark in October 2009, is now hovering just above what economists deem full employment, the point where further declines could start to push up inflation. Meanwhile, average hourly earnings were virtually flat in December, which was disappointing. Economists hoped to see a 0.2% rise in paychecks. When compared to a year ago, wages climbed 2.5%, which matches October's print for a post-recession high. On the upside, the labour force participation rate ticked up a tenth of a percentage point to 62.6% as the labour force grew by 466,000 persons. In a sign of confidence in the economy, the Fed in December hiked borrowing costs that had helped stimulate the economy since the Great Recession. The Fed's 10-member voting committee said in meeting minutes that the labour market, though still shy of its full potential, showed "further improvement" and "confirmed that underutilization of labor resources had diminished appreciably since early this year."
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