A “Now Hiring” sign at the Appalachian State University internship and job fair in Boone, North Carolina, US, on Friday, Oct. 24, 2025.
Allison Joyce | Bloomberg | Getty Images
The U.S. labor market ended 2025 on a soft note, with job creation in December less than expected, according to a report Friday from the Bureau of Labor Statistics.
Nonfarm payrolls rose a seasonally adjusted 50,000 for the month, lower than the downwardly revised 56,000 in November and short of the Dow Jones estimate for 73,000.
At the same time, the unemployment rate fell to 4.4%, compared to the forecast for 4.5%.
The report presented a muddy view of the labor market, with companies reporting a low level of hiring but households showing employment gains.
In addition, revisions brought totals down for the prior months. The November total saw a slight downward revision of 8,000 to the payrolls number, while October’s loss was even more than originally reported, now at 173,000 compared to the prior estimate of 105,000.
For the full year, payroll gains averaged 49,000 a month, compared to 168,000 in 2024, according to the BLS.
Federal Reserve officials have been watching the jobs picture closely for guidance on the future path of interest rates.
Despite some clamoring for additional rate cuts on top of the three the Fed approved in the latter part of last year, the economy looked in fairly solid shape as a tumultuous year came to a close.
The Atlanta Fed’s rolling measure of incoming economic data is pointing to gross domestic product increasing at a 5.4% annualized pace in the fourth quarter. That comes off a third quarter in which the broad growth measure rose at a 4.3% rate.
In addition, consumers, who power two-thirds of the $31 trillion U.S. economy, spent heavily during the holiday season. Adobe estimates that online spending rose 6.8% from a year ago to record-setting $257.8 billion.
Markets expect the Fed to stay on hold for a period following the succession of cuts that began in September. The next cut is not priced in until June, though that could change following the payrolls report.
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