Jan 10, 2020
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The final snapshot of how America's job market was looking in 2019 has been released, and it's a mixed picture.
Hiring was so-so in December, raises for U.S. workers were lackluster last year, but the nation's unemployment rate is still the lowest in more than half a century.
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Friday's jobs report from the U.S. Bureau of Labor Statistics is unlikely to take the Federal Reserve out of its holding pattern on interest rates, which should keep mortgage rates low and hold down other borrowing costs.
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Hiring disappoints in December
There were fewer-than-expected new jobs in December.
America's employers added 145,000 jobs to their payrolls in December — which is disappointing, because Wall Street analysts had expected the government would say hiring grew by about 165,000 jobs last month.
Also, December's job growth was puny compared to the 256,000 jobs that the U.S. economy added during November.
U.S. manufacturers lost 12,000 jobs last month, following a big gain in November that reflected the end of a strike at General Motors.
Retailers added a strong 41,000 jobs in the midst of the holiday season, even after massive store closings — which are continuing in the new year.
"Retail is suffering on two fronts: razor-thin margins and the shift in consumer preference from bricks to clicks," says Diane Swonk, chief economist with the accounting firm Grant Thornton. "Announcements of store closings have already picked up in January with Pier 1 Imports alone planning to close up to 450 stores."
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Hotels and restaurants had 40,000 new jobs to offer in December, and the health care industry took on 28,000 more workers.
The nation's construction workforce grew by 20,000 thanks to unusually warm weather last month that helped to push some projects along.
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Unemployment remains remarkably low
Employment is the highest since 1969.
Though the numbers for December fell short, 2019 was the ninth year in a row that the expanding economy added around 2 million jobs. And low U.S. unemployment is still stunning.
The jobless rate was unchanged in December at 3.5%, the lowest in more than 50 years.
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"Tight labor market conditions are giving people who once gave up a second chance. Even people who were on disability are rejoining the labor market," Swonk says.
The Bureau of Labor Statistics says the number of "discouraged" workers — those who are unemployed and have stopped looking because they think no jobs are available — has fallen by nearly 100,000 over the past year.
Anyone who's still sidelined should take a look at our guide to the jobs that are growing fastest in the U.S.
Raises are paltry
Americans' paychecks aren't growing much.
Though ultra-low unemployment is making it tougher to find workers with the right skills, employers aren't budging much on what they're willing to pay.
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Average hourly earnings in the U.S. rose just 3 cents in December, to $28.32. Americans' wages grew by just 2.9% during the past year — the smallest year-over-year increase since mid-2018.
"As would-be workers become scarcer, we would expect employers to have to work harder to attract and retain the workers they want," says Elise Gould, senior economist with the nonpartisan Economic Policy Institute. "Wage growth is the most important indicator to watch in 2020."
Experts believe future reports will show bigger increases in paychecks because the minimum wage just got raised in multiple states at the start of 2020.
Want to make this the year you get the pay you deserve? Check out these eight power moves to negotiate a raise.
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Doug Whiteman was formerly the editor-in-chief of MoneyWise. He has been quoted by The Wall Street Journal, USA Today and CNBC.com and has been interviewed on Fox Business, CBS Radio and the syndicated TV show "First Business."
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