The U.S. labor market closed out 2024 with a bang! Employers added 256,000 jobs in December, far exceeding economists' expectations of 155,000. The unemployment rate dipped to 4.1%, capping off a year of steady, albeit slower, growth. While the labor market has been cooling from the pandemic-era highs, December’s numbers signal a renewed sense of optimism heading into 2025.
Key Highlights
Job Growth: The U.S. economy added 256,000 jobs in December, the largest monthly increase since March 2023.
Unemployment Rate: Fell to 4.1% from 4.2% in November.
Wages: Average hourly earnings increased by 0.3% to $35.69, a 3.9% rise over the past year.
Labor Force Participation: Edged down slightly to 83.4% among prime-age workers, driven by a decline in male participation.
Sector Spotlight
Health Care and Social Assistance
Health care led December’s gains with 46,000 new jobs, driven by an aging population and increased demand for services. Social assistance followed closely, adding 23,000 positions, with 17,000 of those in individual and family services.
Leisure and Hospitality
Leisure and hospitality added 43,000 jobs, a strong rebound considering the sector’s monthly average of 24,000 jobs in 2024. This continued recovery points to the enduring demand for travel and dining, even as consumers navigate economic uncertainties.
Retail
Retail employers bounced back, adding 43,000 jobs after a lackluster November. Seasonal adjustments likely underestimated the holiday hiring boom, showcasing retail's resilience as consumer spending remained steady.
Government
Government employment grew by 33,000, bolstered by 10,000 state government roles. While the sector’s 2024 monthly average of 37,000 jobs is below 2023’s 59,000, it’s clear that public sector hiring remains a stable contributor to overall job growth.
Professional Services and IT
While employment in professional services showed little change in December, the sector remains critical to economic growth. According to Eric Peters, Professional Division President, "As businesses continue to embrace managed solutions to streamline operations, the talent pool must adapt to meet the growing need for innovation and efficiency. Employers should focus on strategic partnerships to fill these gaps effectively."
The Bigger Picture
December’s numbers are an encouraging year-end defined by a measured labor market slowdown. The economy added an average of 186,000 jobs per month in 2024, significantly below 2023’s average of 290,000 but consistent with pre-pandemic norms.
Wage growth remained strong at 3.9% year-over-year, helping workers keep pace with inflation. However, the slight dip in labor force participation, particularly among men, highlights potential challenges ahead.
What This Means for Employers
Employers in industries like real estate and property management are particularly poised to benefit from steady growth. Kelly Brown, Property Management Division President at BGSF, notes, "With job growth holding steady in December, it’s a prime opportunity for property management firms to invest in skilled professionals who can maintain tenant satisfaction and asset value as we move into 2025."
What This Means for Job Seekers
For job seekers, opportunities are still abundant across key sectors like health care, social assistance, and retail. The resilience of the job market suggests now is a good time to pursue roles that align with career goals. "As we enter 2025, the continued strength in hiring across key sectors reflects the importance of adaptability and strategic workforce planning—values we prioritize at BGSF every day," says Beth Garvey, CEO and President of BGSF.
As 2025 begins, the U.S. labor market shows signs of renewed vitality. While challenges remain, December’s report offers a hopeful outlook for businesses and job seekers alike. Stay tuned as we continue to provide insights and strategies to help you navigate the ever-changing job market.
Want to discuss how these trends could impact your hiring or job search? Contact BGSF today!
About BGSF
BGSF is a leading workforce solutions provider that connects employers with top talent across industries such as property management, professional services, IT, and managed solutions. With a commitment to building strong partnerships, BGSF delivers innovative staffing strategies that empower businesses and job seekers alike.
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