Foodservice Equipment Reports

December U.S. Jobs Growth Was Better Than Expected

Nonfarm payroll employment increased by 200,000 net jobs in December, while the unemployment rate ticked down another 0.1 point to 8.5%, the federal Bureau of Labor Statistics reported Jan. 6. The monthly jobs increase, while far short of that needed to put 13.1 million unemployed Americans back to work, was still an unexpected positive surprise to many economists. Felix Salmon, a financial blogger for Thomson Reuters, called the report “unmitigated good news.”

The further slight improvement in the unemployment rate was also welcome, following the big drop in the rate in November, an event many feared might be an anomaly. The unemployment rate is down 0.6 point from its 2011 high of 9.1%, a rate that held for three months, June through August.

The private sector created 212,000 jobs last month, up from 134,000 in October and 120,000 in November. State, local and federal government shed another 12,000 jobs last month. Government employment has fallen by 280,000 in ’11 as budget cuts have led to wide-spread layoffs.

Among other good news in the report was a drop by 371,000 of those working part-time for economic reasons, though the total number of underemployed is still 8.1 million. Average hourly earnings also rose slightly.

Within the sectors, retail and transportation and warehousing saw increases of 27,900 and 50,200 respectively (the figures are seasonally adjusted, so account for the holiday surge in such positions); healthcare added 28,700 jobs; and leisure and hospitality was up 21,000, thanks to a 24,000 gain in foodservice employment.

Among the goods-producing sectors, manufacturing added 23,000, mining and logging was up 8,000, and even the much-battered construction sector saw an increase of 17,000 after months of continuing declines. There are currently a third fewer construction jobs in the U.S. than there were in ’06-’07.

Given the “balance-sheet” nature of this downturn and the major structural issues faced by the U.S. economy, few economists expect a quick turnaround of the short-term employment picture. But most observers last week seemed cheered by the unexpected gains in December.

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