Despite Other Instability, the US Unemployment Slows After Adding 312,000 Jobs in December

It looks like US employers ended the year on a high, despite lots of volatility in the stock market.  According to the recent jobs report, an impressive December hiring spree added an impressive 312,000 jobs to the economy, injecting some much needed reassurance following some of the most turbulent months the US stock market has seen in many years. 

Perhaps more exciting, the US Department of Labor’s job report offers some confidence during one of the most pivotal times in history. To reiterate, the stock market has been a bit of a mess and the supposed trade war with China has also been staggering, to say the least.  And a partial government shutdown—which is about to enter its third week—is not making anything easier.

Still, in the face of these obstacles, unemployment rose only to 3.9 percent last month, up from the near five-decade low of 3.7 percent.  Now, that might sound contrary to positive outlook, but unemployment has been escalating and this appears to be a much slower rate.  Indeed, investors had only anticipated about 180,000 new non-farm jobs. As a matter of fact, the total employment gains for the entire year of 2018—2.64 million—is the highest in three years. 

Actually, employment looks excellent going into the New Year. The US government report that 176,000 new jobs were created in November, alone, notably higher than the 155,000 analysts had anticipated.  In October, job gains increased by 274,000.

Analysts theorize this number suggest more Americans are out looking for work (and finding new jobs). More importantly, though, the jobs report also suggests that average hourly pay is more than 3 percent higher than one year ago. 

These numbers might not seem like much but simply upon release of the report, US stocks surged.  Coupled with mention that the US and China plan to hold trade talks next week, the stock market seems to be ready to settle.  Finally, Federal Reserve Chairman Jerome Powell has also commented that the Fed is diligently weighing the impact of raising interest rates, and that helped the Dow Jones Industrial Average to shoot up 747 points, which is more than 3 percent. 

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