December 2021 monthly job growth was the lowest of the year

The US economy added 199,000 jobs in December, lower than gains in all other months in 2021, according to data from the Bureau of Labor Statistics (BLS).

The overall unemployment rate continued its steady decrease, however, dropping 0.3 percentage points to 3.9% for the month. The number of unemployed people fell by 483,000 to 6.3 million. The Census Bureau’s December Household Survey data shows 3.1 million people were “unable to work due to their employer closing or losing business due to the pandemic.” That’s about 500,000 fewer than in November.

Still, employment is not back to pre-pandemic levels. About half a million more people were unemployed as of December 2021 compared to January 2020. The 3.9% unemployment rate is 0.4 percentage points higher than January 2020. US total employment is now at 148.9 million, 2.2% lower than January two years ago.

Employers routinely add jobs in December for the holiday season, but December 2021 retail employment dropped by 2,100 jobs.

The leisure and hospitality sector led December growth, adding 53,000 jobs, or 24.8% of new positions. The sector led job growth in June, July, September, and October as well.

Professional and business services, a sector that ranked second in total job growth for September, October, and December, also continued its trend of upward growth. The sector added almost 4% more jobs from January 2021.

The government sector lost jobs for the fifth month in a row. Notably, local government jobs fell by 10,000, while state government jobs stayed flat.

Average hourly earnings continued to grow, increasing by 19 cents to $31.31. Hourly earnings are up $2.88 from January 2020.

On average, hourly earnings increased by 0.4% a month from January 2020 through December 2021. Monthly changes from 2018 through 2019 increased by an average of 0.26%.

Track other indicators about the pandemic and how the nation is faring at the COVID-19 Impact and Recovery Hub.