Strong December Jobs Report Closes Out a Mixed 2024

By SBE Council at 10 January, 2025, 1:35 pm

by Raymond J. Keating -

The December employment report from the U.S. Bureau of Labor Statistics showed that 2024 closed out on a strong jobs note.

The establishment survey estimated that nonfarm payroll jobs in December 2024 were up by 256,000 versus November. Nonfarm payroll employment strengthened in the latter part of 2024, rising by more than 200,000 in three of last four months of the year. However, it is worth nothing that big chunks of the gains in December jobs were due to government and social assistance.

Meanwhile, the household survey - which is more volatile month-to-month but more comprehensive, especially in that it better picks up on small business and startup activity - estimated that employment jumped by 478,000 in December. That came after a notable decline of 273,000 in November. (The household data went through its annual seasonal adjustment update, with this revision covering January 2020 to November 2024.)

In December, the labor force participation rate remained steady at 62.5 percent, and the employment-population ratio registered 60.0 percent in December, compared to 59.8 percent in November and 60.0 percent in October.

Overall, 2024 was a mixed-to-positive jobs year, based on the household data. That is, positive but not exactly robust. For example, the December labor force participation rate of 62.5 percent was down from 62.7 percent in several months during the year, with September being the most recent month. And the employment-population ratio of 60.0 percent was off from 60.3 percent in March.

A strong economy that's creating jobs and increasing incomes will require federal policymaking to shift decisively in a pro-growth direction, namely, substantial and permanent tax and regulatory relief, reining in government spending and debt, advancing free trade, opening the door to immigrants who will work and start businesses, and having a Federal Reserve focused on sound money rather than trying to manipulate the economy via interest rate changes.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. He is the author of "The Weekly Economist " book series, and 10 Points from Walt Disney on Entrepreneurship.