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December’s employment report illustrated continued robust growth in the U.S. labor market, with substantial additions coming from various sectors of the economy.
According to the Bureau of Labor Statistics, the healthcare and social assistance sector marked the highest job gains for the third consecutive month, contributing 69,500 positions to the payroll. If private education is included in this sector, the total growth would reach approximately 80,000 jobs.
The retail trade sector added 43,400 jobs, while the leisure and hospitality sector saw an increase of 43,000 jobs, securing the second and third largest job gains last month. The BLS defines retail trade jobs as including positions both within stores and outside, encompassing everything from telemarketing to street vending, and even extending to post-sale services like installations and repairs.
Government sector employment also contributed positively, with an increase of 33,000 jobs in December.
Julia Pollak, chief economist at ZipRecruiter, remarked to CNBC that job growth has recently been predominantly centered in government and health care, but signs indicate a more diversified recovery might be underway. “Now, it seems like perhaps it’s broadening out,” she stated.
Retail’s resurgence contrasts sharply with the significant losses faced in November and indicates a broader improvement in the sector, as employment grew in key categories. Clothing and accessory retailers, in particular, gained 23,000 jobs, while general merchandise and health and personal care sectors added 13,000 and 7,000 jobs, respectively, according to BLS data.
Pollak emphasized that this rise appears to be more than a transient spike, reflecting broader positive trends within the retail landscape.
Supporting this notion, the Federal Reserve Bank of Dallas’ December Texas Retail Outlook Survey reported an increase in retail sales activity, with the sales index reaching its highest level since late 2021.
Pollak noted the optimism among retailers for 2025, attributing this sentiment to a strong consumer base. “We’ll probably see more movement in the housing market coming soon,” she added.
Conversely, the manufacturing sector experienced a downturn after a period of substantial growth, shedding 13,000 jobs in December. Similarly, mining and logging, along with wholesale trade, saw declines, reversing earlier gains. Mining and logging employment decreased by 3,000, while wholesale trade faced a more significant retreat with a loss of 3,500 positions.
Professional and business services, along with financial activities, remained bright spots in the labor market. These sectors were part of 13 sectors that saw job growth last month.
Pollak observed positive trends in consumer behavior, stating, “We’re seeing improvement in total vehicle sales, Americans are making big ticket purchases again, and businesses are buying vehicles too.” She indicated that while these trends were slow to impact the labor market, recent reports suggest that a broader recovery may finally be gaining momentum.
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