Healthy US hiring should make 2014 best since 1999
WASHINGTON (AP) — The best year for U.S. hiring since 1999 likely ended with another solid gain in December, supporting expectations that the United States will strengthen further even as overseas economies stumble.
Analysts have forecast that U.S. employers added 243,000 jobs in December, according to a survey by data provider FactSet. The unemployment rate is expected to remain a nearly normal 5.8 percent, the lowest in six years.
The Labor Department will release the jobs report at 8:30 a.m. Eastern time Friday.
American businesses have been largely shrugging off signs of economic weakness overseas and continuing to hire at healthy rates. The U.S. economy’s steady improvement is especially striking compared with the weakness in much of the world.
Europe is barely growing, and its unemployment rate is nearly double the U.S. level. Japan, the world’s third-largest economy, is in recession. Russia’s economy is cratering as oil prices plummet. China is straining to manage a slowdown. Brazil and others in Latin America are struggling.
Fears about significantly cheaper oil spooked investors earlier this week before financial markets recovered. But most economists remain optimistic that lower energy prices will benefit U.S. consumers and many businesses and give the American economy a further boost.
Hiring surged in November as 321,000 jobs were added, the most in nearly three years. December’s job gain should raise last year’s total to nearly 3 million, which would be the most in 15 years.
The improving jobs picture has healed some of the deep scars left by the Great Recession. The number of people who have been unemployed for more than six months fell 27 percent last year. And the number working part time who would prefer full-time work dropped 12 percent.
A rate that includes the officially unemployed as well as the involuntary part-timers and people who have given up looking for work was 11.4 percent in November. That was down from 13.1 percent at the start of 2014.
And the percentage of the adult population who have jobs rose to 59.2 percent in November, from 58.6 percent when 2014 began. That was the first sustained improvement in that measure since the recession officially ended 5½ years ago.
Still, much healing remains to be done. To keep up with population growth since the recession began, the economy would need to create 4.9 million additional jobs, according to the Brookings Institution.
Average hourly pay is barely staying ahead of inflation. It rose 2.1 percent in November compared with a year earlier, not far above the 1.7 percent inflation rate. In 1999, average wages rose 3.5 percent.
Economists do expect more healing to occur this year. Tumbling oil and gas prices have put more money in consumers’ pockets, enhancing their ability to spend. Goldman Sachs estimates that the additional spending on restaurants, auto dealers and other goods and services will lead to the creation of 300,000 more jobs this year than if oil prices remained at their June levels.
Spending at retail stores and restaurants rose in November by the most in eight months, an early sign that Americans are already spending some of the savings they are enjoying on gas-pump prices.
Car sales jumped 6 percent last year to the highest level since 2006, according to Autodata Corp. Analysts forecast that sales will reach 17 million this year, near the record of 17.3 million set in 2000. That should lead to more jobs at automakers, parts suppliers and dealers.