Employers added 50,000 jobs in December, notching a solid gain for the economy but ending the worst year for the labor market since the pandemic-era recession.
The unemployment rate ticked down to 4.4 percent, according to Labor Department data released Friday.
Job creation for October was revised weaker, showing the economy lost 173,000 jobs that month as tens of thousands of federal workers took a deferred resignation package. November job creation was also revised down slightly.
Economists had estimated that employers added some 73,000 jobs in December buoyed by a later-than-typical start to the holiday season and a hiring spree by federal law enforcement.
In 2025, the labor market weathered Trump administration policies better than expected by some economists and policymakers. Tariff and immigration enforcement policies are still rippling through the economy but layoffs appear to be contained for now, hitting a 17-month low in December, the consulting firm Challenger, Gray & Christmas said Thursday.
However, 2025 marked the fewest jobs gained for workers since 2020 and the highest unemployment rate since 2021.
Economists did not expect a December bump in job creation to make up for a year that became increasingly gloomy as the months progressed.
“It’s more difficult to get a job right now, because corporate America looks to be in an extended hiring pause,” said Joe Brusuelas, chief economist at RSM US. “The duration of unemployment is slowly rising.”
The number of job openings hit the lowest level in more than a year and hiring slowed in November, according to a separate jobs report released Wednesday by the Labor Department.
“A lot of job openings are ‘ghost openings,’” said North, the Allianz Trade Americas economist. “They’re positions that are posted that were never really meant to be filled unless a really awesome candidate comes along.”
The Trump administration’s aggressive immigration crackdown and deportation efforts could mean that fewer jobs are needed to keep the unemployment rate steady compared to previous years. Economists say it’s possible that around 50,000 jobs a month is enough to maintain a healthy labor market, as net immigration to the United States plummeted in 2025.
Brusuelas, the RSM economist, said that slowing job growth is also an effect of “the [hiring] pause that the corporate sector is engaged in as they assess the impact of their investment in AI.” That could spell solid economic growth and corporate profits in 2026 even with a weak labor market.
“Corporations are rightsizing their workforce and they’re being rewarded for it in terms of their stock share prices,” Brusuelas said. “I think this is where we’re going to be at for a good period of time.”
In 2025, health care and social services buoyed the entire labor market, as demand from aging Baby Boomers grew. Economists warn that a labor market dependent on just one or two sectors remains more vulnerable to one-off shocks.
Elsewhere, hiring stagnated with the federal government leading job losses this year.
Federal Reserve officials cut interest rates at three consecutivemeetings at the end of 2025, signaling that they are more focused on cushioning a softening job market than fighting still stubborn inflation.
Fed Chair Jerome H. Powell warned in December that official statistics could be overstating job creation by 60,000 jobs a month, calling jobs data “a complicated, unusual and difficult situation.”
Abha Bhattarai contributed to this report.
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