US economy generates huge 292,000 jobs in December

The US jobs machine picked up pace in December, generating a huge 292,000 net new positions, stifling worries that the economy could be slowing down.

The Labor Department reported today that job creation for the previous two months was also significantly stronger than originally reported, though wage gains still did not reflect much tightening of the labor market.

The unemployment rate held at 5.0 per cent, as expected, but the number of new jobs created was far better than economists had forecast, at around 200,000.

The December data appeared to confirm the views of the Federal Reserve that the employment sector was seeing enough growth and tightening to justify it raising interest rates last month for the first time in over nine years.

Hiring was solid across the board, led by construction, professional and business services, and health care.

But there was still little improvement in wages, or the number of people forced to work part time because they cannot find full-time jobs, that would confirm that the employment sector has fully recovered more than six years after the Great Recession.

Hourly earnings declined marginally in the month, and were up just 2.5 percent from a year ago. The participation rate in the labor market remained at a low 62.6 percent, compared with more than 66 percent before the recession.