The slowdown in job growth is consistent.
A Reuters survey has found an increase in hiring by US companies in December despite adverse scenarios such as raising wages, Federal Reserve’s increase of interest rate and measure to put the country’s economy back to stronger path.
According to the survey, the nonfarm payrolls registered an increase of 178,000 jobs last month, this after similar rise was recorded in November. It also says that the unemployment rate in the US so a feather increase in the month December to 4.7 when compared to 4.6 percent in November.
The survey also says that the average hourly earnings of workers will improve with an assumed rise of 0.3 percent after a .1 percent dip in November.
The employment report prepared by the Labor Department that will add more information from housing to auto sales. The employment report will be published at 8:30 am and it is speculated that the report will document the economic progress made by the Obama Administration as they gear up to vacate their positions for the Trump administration.
“It will show the economy finished 2016 on a strong note with buoyant activity,” said Thomas Costerg, a U.S. economist at Standard Chartered Bank in New York said to Reuters.
“It’s a stronger starting point for the Trump administration. There is prevailing optimism across the economy which bodes well for 2017,” he added.
Going by the campaign promises of President-elect Donald Trump in the first year in office he will increase spending on improving the infrastructure of the country, cut taxes and relax regulation, which ultimately will boost the American economy by the end of 2017.
But the proposed expansionary fiscal policy stance could increase the budget deficit. That, together with faster economic growth and a labor market that is expected to hit full employment this year could raise concerns about the Fed falling behind the curve on interest rate increases.
Earlier in December, the US central bank had increased its benchmark interest rate by 25 basis points to a range of 0.50 percent to 0.75 percent. The Fed forecast three rate hikes this year.
“With the specter of a fiscal stimulus lifting growth and inflation further, there is a risk that the Fed will have to raise interest rates at a faster pace,” said Harm Bandholz, chief U.S. economist at UniCredit Research in New York.
The report also says that the Employment growth in the first 11 months of 2016 averaged 180,000 jobs per month, a sharp decrease from last year’s average of 229,000 per month. The slowdown in job growth is consistent with a labor market that is near full employment, says the report.