Young man sitting with resume in waiting room among other candidates and waiting for his turn for job interview

Nonfarm payroll employment added 223,000 jobs in December, following an increase of 256,000 jobs in November (downward revision), according to the latest data from the Bureau of Labor Statistics (BLS). 

This brings the total increase in payroll employment for 2022 to 4.5 million, averaging +375,000 jobs per month (less than 2021’s 6.7 million total and monthly average of +562,000).

“Despite the economic unease, the labor market is still tight,” said James Neave, Head of Data Science at job search engine company Adzuna. “On Adzuna, advertised job vacancies in the U.S. tracked 9.8 million in December and sectors like Retail, Hospitality & Catering, and Healthcare & Nursing are still making significant hires.”

“We saw consistent hiring for most industries through the end of 2022, especially for tech and digital skills,” said Nicola Hancock, Managing Director – Americas Region at workforce solutions firm AMS, “While growth is slowing some, we expect to see open tech positions continue throughout Q1 in industries like life sciences, healthcare, retail, and hospitality.”  

Leisure and hospitality leads growth, temp jobs fall

BLS data shows that leisure and hospitality employment went up by 67,000 in December, with most of the increase in food services and drinking places (+26,000) and amusements, gambling, and recreation (+25,000). The industry has averaged +79,000 jobs per month in 2022 (below 2021’s +196,000 monthly average) and is still behind its pre-pandemic level by 932,000 jobs (5.5%). 

Other notable job gains in December included:

  • Health care (+55,000)
  • Construction (+28,000)
  • Social assistance (+20,000)
  • Other services (+14,000)
  • Retail trade (+9,000)

Meanwhile, temporary help services employment continued to drop dramatically in December, losing 35,000 jobs. Since July, employment in the industry has declined by 111,000 jobs.

Unemployment rates change little

The overall unemployment rate inched down to 3.5% in December, representing 5.7 million unemployed people. 

Unemployment rates for major worker groups had little or no change in December: 

  • Adult men: 3.1% (3.4% in November)
  • Adult women: 3.2% (3.3% in November)
  • Teenagers: 10.4% (11.3% in November)
  • Black: 5.7% (5.7% in November)
  • Hispanic: 4.1% (3.9% in November)
  • Asian: 2.4% (2.7% in November)
  • White: 3.0% (3.2% in November)

Long-term unemployment down, part-time work up

The number of people experiencing long-term unemployment (jobless for 27 weeks or more) dropped by 146,000, totaling 1.1 million in December and accounting for 18.5% of the total unemployed. The labor force participation rate rose slightly to 62.3% for the month.

A total of 3.9 million people worked part time for economic reasons in December (up from 3.7 million in November). Down from 5.6 million people in November, there were 5.2 million people not currently in the labor force who wanted a job in December, approaching the pre-pandemic total of 5.1 million. Among them, 1.3 million were marginally attached to the labor force and 410,000 were considered discouraged workers.

Pay continues to rise as workers prioritize compensation 

Average hourly earnings for private nonfarm employees went up another $0.09 (0.3%) in December, coming in at $32.82. Hourly pay has increased 4.6% over the last 12 months. 

“With financial anxiety fueled by headlines and layoffs, peoples’ priorities are again shifting back to compensation over flexibility and perks,” Neave commented. “Employers that want to recruit and retain employees should be considering being more transparent about pay as they plan how to evolve their strategies in 2023.”

“It’s still a candidate market,” Hancock added, “and companies have to be thoughtful about how they hire and keep talent this year.”