Employment Ends Year On Strong Note

More Hiring, More New Jobs, And A Steady Unemployment Rate Of 4.5% In December

(CBS/AP)  Employers stepped up hiring last month, boosting payrolls by a brisk 167,000 and keeping the unemployment rate steady at a still historically low 4.5 percent. Workers' wages grew briskly.

The latest snapshot of the nation's employment climate, released Friday by the Labor Department, showed that the jobs market ended 2006 on a strong note and provided fresh evidence that the troubled housing and automotive sectors aren't dragging down employment across the country.

"This is a very low unemployment rate by historical standards. There are jobs out there. There aren't a lot of people looking for them," David Wyss, chief economist at Standard & Poor's, told CBS Radio News.

Analysts had predicted that 132,000 new jobs would be created and that the unemployment rate had held steady at 4.5 percent, reports CBS News correspondent Alexis Christoforous. The job-creation number was even better than expected, and the rate prediction was dead on.

"The numbers were very good, unexpectedly good, actually, and it just continues to show how resilient the U.S. economy is," Touro College finance professor Peter Sperling told CBS Radio News.

For all of 2006, the nation's unemployment rate dropped to a six-year low of 4.6 percent. In 2005, the unemployment rate averaged 5.1 percent.

With the economy losing momentum, though, many economists predict the jobless rate will climb this year and average around 4.9 percent.

Employers showed not only a greater appetite to hire in December but also more willingness to boost compensation to workers.

"It's partly a reflection of the strength in the labor market. As the labor market remains tight, employers are willing to pay more," said Sperling.

Workers, many of whom had seen their paychecks eaten by inflation, saw wages grow robustly last month. Average hourly earnings jumped to $17.04, a sizable 0.5 percent rise from the prior month. Analysts were forecasting a more modest, 0.3 percent increase.

Over the last 12 months, wages grew by a strong 4.2 percent. That matched the annual gain registered in November and was exceeded only by a 4.3 percent annual increase in November 2000.

Growth in wages should support consumer spending — a force that helps drive the economy. But a rapid and sustained advance — if not blunted by other economic forces — can stoke concerns about inflation.

"It's good for earnings from a standpoint that we're getting paid more, but it's bad from a standpoint that the Fed is going to be worried more and more about inflation," said Wyss. "It certainly eliminates any chance of an interest rate cut in the near future."

Federal Reserve Chairman Ben Bernanke says the central bank will be on close watch for any signs that wage growth might be spurring an unwanted pickup in inflation.

The Federal Reserve, which has boosted rates 17 times since June 2004 to fend off inflation, has been on the sidelines since August. Analysts believe the Fed will keep its finger on the interest-rate pause button when it meets next on Jan. 30-31.

"Hiring increases have been pretty consistent across the board, except in manufacturing and construction," said Sperling. "The auto industry continues to be weak, but in most of the rest of the economy — the service sector, retail, financial services — employment is pretty good."

The latest employment snapshot comes as the new Democratic-controlled Congress, which convened Thursday, will now play a lead role in shaping policies for workers and businesses.

A top priority for Democrats is boosting the federal minimum wage from $5.15 an hour to $7.25 an hour. President Bush said he supports such a move as long as it is paired with business-friendly provisions, which would soften the sting to employers who would have to dole out more in labor costs.

The job hunt got shorter in December.

The average time that the 6.8 million unemployed people spent in their job searches was 15.9 weeks, down from 16.3 weeks in November.

The strong showing on jobs comes even as the economy lost steam throughout last year.

Economic growth slowed to a pace of 2 percent in the late summer — the most recent period available — and is expected to remain sluggish for a while as the economy works its way through fallout from the housing slump and the lingering impact of two years of rising interest rates.

Even with the expectations for slow growth ahead, most analysts don't believe the economy will slide into recession, but they do predict that the unemployment rate will climb.

[gramto7]

Re: These 'great' jobs that are available, my brother who is disabled and on SS disability income is trying to work to regain his independence from the program. He has to depend on public transportation as neither he nor I (he lives with me) own a car. His paycheck for the last TWO weeks was a grand total of $58 out of which he has to pay $8 a day for the bus! There are no monthly discount tickets or other methods of transportation available. So much for those GOOD jobs!!

A better idea would be to set a lower limit on the tax information from the IRS and subtract the number of people making an income above that level from the total population of the united states from the census data and estimate current population growth between censuses. The number would be completely imaginary of course, but at least it might present a closer image of american employment. I would rather have that number than the number of people on unemployment benifits.

Yes. Welcome to Elementary Political Statistics or EPS for short. That is why you should never put to much stock in ANY graph, statistic, or analysis without seeing the source data.

My favorite is the calculation of poverty in america. What if I said 3 percent of Americans were living in poverty? Well what does poverty mean exactly?

What does unemployment mean? It doesn't mean being out of work.

It really amazes me at how they report the unemployment rate, they count how many people are recieving unemployment compensation and not how many people are actually out of work after their compensation ended or if they even got any at all....

[fascistusa]

You'RE ALL JUST A BUNCH OF SLAVES - Jim Morrison

Geeze. I wonder where he got that from?

The ONLY real threat to a Fascist Tyranny, I mean the US Government, is the Laborers.

Power to the People - John Lennon

You can't even believe this lousy ficticious artice.
I remember when people getting out of college actually got this thing called "job offers".

[randalds]

The Reps didn't want to hike the min wage cause they wanted all the big companies cult buddies to make the big bucks and have people working for pennies. It's all BS!!!

Posted by luvNY at 02:43 PM : Jan 05, 2007

To them "labor" is just another number in the equation. To them "laborers" are not real human beings, they are just an asset or not. Something to be used or discarded when no longer useful. It sounds like some scary novel of the future that no one takes seriously because they are all convinced that it can't happen here. It is that arrogance, that naive stupidity, that the social scientists of the right wing are counting on. We have had it so soft for so long that we are, for the most part anyway, convinced that we have grown past it and that it can't happen in human history again. Which is exactly why, if we're not careful, it will.

[rharrin1]

perception5

You still haven't removed your head from up your asss. Majority of those new jobs=no insurance.

[luvny-2009]

What a crock of $hit. My son lost his job to Downsizing AKA sending it over seas. It took him 5 months to find a job making 20K less. He still can't make ends meet. The Reps didn't want to hike the min wage cause they wanted all the big companies cult buddies to make the big bucks and have people working for pennies. It's all BS!!!
r_bayless - Sorry I know what you went thru and are now. Hopefully the Dems can put us back on our feet but may be too late for a lot of it.

[specimenfred]

LYING REPIG PRESSTITUTES NEVER STOP BS-ING

[randalds]

Get used to it folks - what started in electronics, spread to the garment industry, and is now permeating the IT industry is going to just keep spreading elsewhere.

It's a harsh world out there these days - especially for those of us just trying to stay in the "middle class".

Posted by r_bayless at 02:01 PM : Jan 05, 2007

Exactly back at ya. The number one target of the Neoconservative movement is the middle-class. They do not want one to exist. Working class people (the proletariat) are more easily managed, esp without such hindrances as safety, the environment or child labor laws to slow your business down. The goal is a 100% pro-business agenda. They honestly believe that America runs better when it's run by big businessmen. Bush's number one tax advisor is a man name Grover Norquist (google him if you want true terror in your life). He said that the goal is to shrink government down to a point here they can "drown it in a bathtub". So Bush and his minions use phrases like smaller government (which everyone, including me, likes), but neglects to say that the smaller government is going to mean no regulation at all, which no thinking person wants!

[ianlou]

Thanks to our "new" ecomomy our nations parents are no longer saying to their children "I designed that" or "I built that". Instead their heard to say, quitely, "I sell that, I serve that". We are becoming an entire nation of people who end every conversation with "Thank you for allowing us to serve you, Please come again!" for half the pay and benefits.

As a Detroiter, I'm sick of hearing about the robust national increase in the these Half-A$$ed McJobs.

[olebd]

Thank you...oh great Wal Mart. You have hired more of our citizens who were previously displaced by outsourcing and/or their job relocating to another country without them. I just wish they were paid enough so that they could afford to celebrate.

[randalds]

Neoconservatism is more then just a philosophy about an American empire and the war to get it. It's also about economics. One of the goals of it is to create a two class society, with a rich ruling elite and a working class. This is one of the reasons Bush slashes taxes on the rich and privatises everything he can, including a large part of our national defense. He wants to try is with Social Security and No Child Left behind, taken to it's conclusion, is a way to privatise public schools. The goal is to have, literally, no government at all or any regulations at all, beyond what laws are needed to keep the peace and to implement war. America came close to this during the late 1800's, when the mega rich paid no taxes and ruled the government. The economic goal of the movement is to go back to that.

P.S. Why do some of the more stupid conservatives complain that we liberals are being insulting by using the word "Neocon"? The neoconservatives gave themselves that name, no one else did.

[jn122736]

perception5,

You are well qualified as a spokesman for this administration and the Republican Party of late, and unfortunately, much of the MSN. Half-truths and twisted fasts are the rule of the day.

Payrolls went up by 16,7000 not 2 million, and unemployment did not drop by 2 million as you claim, it remained steady.

You refer to the $17.04 an hour average income stated in this article. Numbers are used to give whatever impression desired by the user. For instance, if the statistics used in this case did not include the increases for CEO and higher echelon %u201Cearnings%u201D the average income would have been significantly less.

It is a well-established fact that the average household can no longer survive on only one income.
In a household with children, if a wife or husband were to lose their spouse the family can become destitute without aid.

If the $17.04 average income were accurate then why are we about to raise the minimum wage from $5.25 an hour?

You make another wontedly false claim by stating %u201Cthe vast majority once again have health insurance. Very few of above-mentioned 167,000 new jobs guarantee insurance for the family.

You said %u201Cthe deficit dropped like a rock%u201D but of course you conveniently neglected to add the nearly half-trillion dollar interest on the national debt to the new deficit, or to state what it actually is currently.

The main culprits here are the gullibly complacent general public.

[randalds]

The unemployment rate doesn't take into account the quality of jobs (which suck for pay and most have no benefits like health) or the number of people who have given up looking for work or have fallen off from the number collecting unemployment insurance. No matter how they fu*ck with the numbers this is not a jobs recovery, but a rich mans one.

[specimenfred]

CONS SMEARING & LYING AS USUAL, 160K JOBS DOESN'T EVEN KEEP UP WITH POPULATION GROWTH

[getserious1]

specimenfred:

Well if the workers don't like their wage, they can change jobs. I started out making min wage, when it wasn't enough, I worked myself into a better paying job. I believe we have the 'Right to Prosper' NOt the 'Right to BE Prosperous'...BIG difference. In this country you have the freedom to work towards whatever you'd like. You have the right to continue your education, to improve yourself and so forth. Should you choose not to do that, then you 'reap what you sow'.

[processor2]

Again, facts and truth don't mean much to the neolibs. They don't believe this story because it doesn't 'feel' like the truth!

Posted by getserious1 at 10:30 AM : Jan 05, 2007

Getserious1

GREAT POST, couldn't have said it better myself, except, instead of NeoLib's, I would have used NeoCommies. GREAT POST though

.......

[specimenfred]

55,000 jobs were invented out of thin air by the lying BLS -- See for yourself

http://www.bls.gov/web/cesbd.htm

[specimenfred]

Yo repigs, you can stop lying your *** off now. Wages don't keep up with inflation and the minimum wage/retail worker's pay is equal to that of the year 1955.