The US job market saw an eventful 2023, with the private sector hiring at a faster-than-expected pace in December, closing out a robust year for the resilient US jobs market, according to the ADP report.
Economists are projecting that the US economy added 160,000 positions in December, with an average of 232,000 jobs per month through November and around 2.78 million for the year. Despite being lower than the 4.79 million jobs gained in 2022, 2023 still presented historic gains for the labor market, marking a year full of twists and turns.
In January 2023, the unemployment rate fell to 3.4%, a level not seen since 1969, reflecting a strong job market. Likewise, in April 2023, the unemployment rate for Black workers hit a record low of 4.7%, signifying positive strides in job opportunities.
However, as economic activity cools following a post-COVID burst, forecasters estimate that 168,000 jobs were added in December, down from an average of about 200,000 the previous three months. The sharp decline in job growth in December raises questions about whether the labor force continued to expand sharply or if growth has peaked.
The labor force, which includes Americans 16 and over who are working or looking for jobs, surged by 3.3 million in 2023, and the December report could confirm that it grew at its fastest pace in more than two decades. Amidst lingering high inflation and interest rates in the economy, the report will provide insight into the nature of the labor force growth and if it has been sustained.
The December employment report is poised to provide a comprehensive overview of the US job market, shedding light on the economic vibrancy, job growth, and the trajectory of the labor force. Economists and analysts will scrutinize the data to discern the implications for monetary policy, inflation dynamics, and the overall economic outlook for the year ahead.
