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Strong job gains in December point to solid year for the U.S. economy

Friday, January 09, 2015 - 02:00

Job growth topped estimates in the latest month, climbing to more than 250,000. That marks the 11th straight month of payroll increases above the 200,000 level. Leah Duncan reports

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Strong job gains in December totaling a solid year for the U.S. economy. Job growth topped estimates in the latest month, climbing to more than 250,000...marking the 11th straight month of payroll increases above the 200,000 level. November's record number was revised up by more than 30,000. Jason Furman, Chairman of the White House Council of Economic Advisers. SOUNDBTIE: JASON FURMAN, CHAIRMAN OF THE WHITE HOUSE COUNCIL OF ECONOMIC ADVISERS(ENGLISH) SPEAKING "Well this now gives us the full set of number for 2014. And it caps what was a very strong year for the U.S. economy. Three million jobs added, that's the most since 1999." As for the unemployment rate, that fell to a six and a half year low of 5.6 percent... but that was partly due to people leaving the labor force. But there was one area that took some shine off of the report - that's average hourly earnings- it dropped five cents, after rising in November. Cary Leahey, Senior Adviser, Decision Economics SOUNDBTIE: CARY LEAHEY, SENIOR ADVISER AND CHIEF U.S. ECONOMIST, DECISION ECONOMIST (ENGLISH) SPEAKING: "Ironically, the big surprise in this report, which has a lot of moving parts is the fact that wages in the economy actually dropped in December. Like most analysts, I'm still scratching my head trying to figure that out." Now economists say falling wages could build a case for the Fed to keep interest rates near zero for a longer time. SOUNDBTIE: CARY LEAHEY, SENIOR ADVISER AND CHIEF U.S. ECONOMIST, DECISION ECONOMIST (ENGLISH) SPEAKING: "The Fed does not want to repeat the mistake of 1937 when accommodation was removed prematurely. So in some sense they want to have all cylinders firing in the labor market and that hasn't happened yet. Yes job gains are strong, but we still have a lot of people that will like to work full time who are working part time and more importantly the wage gain numbers just aren't there." Chicago Fed President Charles Evans is calling for the central bank to defer raising rates until next year. Minneapolis Fed President Narayana Kocherlakota is also of the belief that rates should stay where they are at least for another year.