U.S. Unemployment Rate was little changed at 3.5% in December

January 10, 2020

Total nonfarm payroll employment increased by 145,000 in December, as the rate of unemployment stood constant at 3.5%, as stated by the U.S. Bureau of Labour Statistics. Retail trade and health care reported job gains while mining lost jobs.

Retail trade increased in December (+41,000) as the segment added a total of 9,000 jobs in 2019 versus 14,000 in 2018 while healthcare continued its upward trend adding 28,000 jobs in December and 399,000 jobs in 2019 compared to 350,000 in 2018. Employment in leisure and hospitality rose by 40,000 over the month and 388,000 jobs in 2019 (2018: 359,000 jobs). Mining, however, employment decreased by 8,000 in December. BLS stated, “In 2019, employment in mining declined by 24,000, after rising by 63,000 in 2018.” Moreover, employment within the other major industries (including wholesale trade, information, financial activities, and government) reflected little change over the month.

In December, the number of unemployed persons was little changed at 5.8 million, while the number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.2 million. Notably, the total number of persons classified as long-term unemployed, accounted for 20.5% of the unemployed.

The labour force participation rate for December remained unchanged at 63.2%, while the employment population ratio was held at 61% for the fourth consecutive month.

Persons employed part time for economic reasons stood at 4.1 million in December. Based on BLS assessment, “these individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.”

A total of 1.2 million individuals were slightly attached to the labour force, a 310,000 reduction from last year. These persons were not in the labour force, wanted and were available for work, and had looked for a job in the last year.

Of the marginally attached, 277,000 persons were classified as discouraged workers in December, declining by 98,000 a year ago. These persons are not currently seeking for work as they believe no jobs are available for them. There are still 969,000 persons marginally attached to the labour force in December who had not sought employment for reasons such as school attendance or family responsibilities.

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