JANUARY 9, 2023 — DECEMBER JOBS NUMBER BEATS EXPECTATIONS
The US economy added 223,000 new jobs in December, beating expectations for 200,000 new positions, but it’s the smallest gain in two years. The unemployment rate fell to 3.5 percent, which equals the lowest rate since 1969. Average hourly wages rose 0.3 percent month-over-month and 4.6 percent year-over-year below the 5 percent forecast.
The economy is continuing to add new jobs, albeit at a slower rate, and wage growth has slowed which indicates inflation pressures could be weakening. These are indications that hiring may slow down or decline in 2023.
The report is not enough to stop the Fed from raising rates in the foreseeable future, but the slowdown in wage growth is encouraging. The country is heading into the new year with economists expecting a shallow recession. At this time, we are anticipating the Fed will lift rates by 0.25 percent at their next meeting February 1.