Non-Farm Payrolls Rise By More Than Expected 252K, But Hourly Earnings Plunge Most In At Least 8 Years

On the surface, the December jobs report was good, with 252K jobs added, higher than the 240K expected, leading to a fresh cycle low unemployment rate of 5.6%, down from 5.8% and below the 5.7% expected, and with the November data revised to a whopping 353K from 321K, a net change of 50K including the October revision.

However it was the average hourly earnings where the real details were hid, and it was here that Wall Street was expecting a 0.2% increase. Intead the BLS reported a whoppping 0.2% decline in average hourly earnings, with the last month's 0.4% jump revised lower by half to 0.2%.This was the biggest crash in hours earnings since the data series began in 2006.

 

Which means one thing: the waiter, bartender, retail worker recovery continues.

From the report:

Total nonfarm payroll employment increased by 252,000 in December. In 2014, job  growth averaged 246,000 per month, compared with an average monthly gain of 194,000  in 2013. In December, employment increased in professional and business services,  construction, food services and drinking places, health care, and manufacturing.  (See table B-1.)

Employment in professional and business services rose by 52,000 in December.  Monthly job gains in the industry averaged 61,000 in 2014. In December, employment increased in administrative and waste services (+35,000), computer systems design  and related services (+9,000), and architectural and engineering services (+5,000).  Employment in accounting and bookkeeping services declined (-14,000), offsetting  an increase of the same amount in November.

Construction added 48,000 jobs in December, well above the employment gains in  recent months. Specialty trade contractors added jobs in December (+26,000), with the gain about equally split between residential and nonresidential contractors.  Employment also increased in heavy and civil engineering construction (+12,000)
and in nonresidential building (+10,000).

In December, employment in food services and drinking places increased by 44,000.  The industry added an average of 30,000 jobs per month in 2014.

Health care added 34,000 jobs in December. Job gains occurred in ambulatory health care services (+16,000), nursing and residential care facilities (+11,000), and hospitals (+7,000). Employment growth in health care averaged 26,000 per month in 2014 and 17,000 per month in 2013.

In December, manufacturing employment increased by 17,000, with durable goods (+13,000) accounting for most of the gain. Manufacturing added an average of 16,000 jobs per month in 2014, compared with an average gain of 7,000 jobs per month in 2013.

Employment in wholesale trade and in financial activities continued to trend up in December.  

Employment in retail trade changed little in December, following a large gain in November. Employment in other major industries, including mining and logging, transportation and warehousing, information, and government, changed little in December.

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.6 hours in December. The manufacturing workweek edged down by 0.1 hour to 41.0 hours, and factory overtime edged up by 0.1 hour to 3.6 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged up by 0.1 hour to 33.9 hours. (See tables B-2 and B-7.)

In December, average hourly earnings for all employees on private nonfarm payrolls decreased by 5 cents to $24.57, following an increase of 6 cents in November. Over the year, average hourly earnings have risen by 1.7 percent. In December, average hourly earnings of private-sector production and nonsupervisory employees decreased by 6 cents to $20.68. (See tables B-3 and B-8.)

The change in total nonfarm payroll employment for October was revised from +243,000 to +261,000, and the change for November was revised from +321,000 to +353,000. With these revisions, employment gains in October and November were 50,000 higher than previously reported.