US Jobs Growth Slows in December as Unemployment Rate Unexpectedly Falls to 4.4%
US employment data for December showed mixed results with nonfarm payrolls rising by only 50,000, missing estimates of 73,000, while unemployment rate unexpectedly fell to 4.4% from 4.6%. Annual job growth averaged 49,000 monthly in 2025, down sharply from 168,000 in 2024, reflecting labour market deceleration.
*this image is generated using AI for illustrative purposes only.
The US labour market concluded December with mixed signals, as job creation fell below expectations while the unemployment rate posted an unexpected improvement, according to data released by the Bureau of Labor Statistics (BLS).
December Employment Data Shows Contrasting Trends
The latest employment report revealed divergent trends across key labour market indicators:
| Metric: | December | November (Revised) | Expectation |
|---|---|---|---|
| Nonfarm Payrolls: | 50,000 | 56,000 | 73,000 |
| Unemployment Rate: | 4.40% | 4.60% | 4.50% |
Nonfarm payrolls rose by a seasonally adjusted 50,000 in December, falling well short of the Dow Jones estimate of 73,000. This represented a decline from November's downwardly revised figure of 56,000, indicating continued weakness in business hiring activity.
Despite the subdued job creation, the unemployment rate declined to 4.4%, defying expectations of 4.5% and showing improvement from November's 4.6%. This contradiction highlights the complex nature of the current labour market, where businesses report restrained hiring while household data indicates employment gains.
Historical Revisions Paint Weaker Picture
Revisions to previous months' data further dampened the overall employment outlook:
| Month: | Original Estimate | Revised Figure | Revision |
|---|---|---|---|
| November: | 64,000 | 56,000 | -8,000 |
| October: | -105,000 | -173,000 | -68,000 |
November payrolls were revised down by 8,000, while October job losses deepened significantly to 173,000, compared with the earlier estimate of 105,000. These revisions underscore the labour market's weaker momentum in the final quarter.
Annual Employment Trends Show Marked Deceleration
The full-year data reveals a substantial slowdown in job creation:
| Year: | Average Monthly Job Growth |
|---|---|
| 2025: | 49,000 |
| 2024: | 168,000 |
For 2025 as a whole, payroll growth averaged just 49,000 jobs per month, representing a sharp decline from 168,000 in 2024. This deceleration reflects the broader cooling in labour market conditions throughout the year.
Economic Context and Federal Reserve Implications
Federal Reserve officials continue monitoring labour data closely for guidance on interest rate policy. While markets expect the Fed to maintain current rates following three cuts implemented late last year, broader economic indicators suggest continued momentum.
The Atlanta Fed's GDPNow model projects 5.4% annualised growth in Q4, following 4.3% growth in Q3. Consumer spending has remained robust, with online holiday sales rising 6.8% year-on-year to a record $257.80 billion, according to Adobe data.
Markets currently do not anticipate the next rate cut until June, though expectations may shift as investors analyse the latest labour market developments and their implications for monetary policy.
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