From Real Time Economics:
U.S. employers added 252,000 new jobs in December, marking the strongest year of job growth in 15 years, while the unemployment rate dropped to 5.6%, the Labor Department said Friday. But wages aren’t taking off, with average hourly earnings falling from November and up only 1.7% from a year earlier....MORE
“With today’s jobs report, we can now look at the state of the labor market in 2014 as a whole, and examine the trajectory of our economic recovery. The good news is that in 2014 people were increasingly finding jobs. The bad news is that we are still digging our way out [of] the recession, and wage growth remains stagnant and untouched by recovery.” –Elise Gould, Economic Policy Institute
“At face value, the December jobs report looks great, with jobs rising more than expected and the unemployment rate falling to a fresh low of the cycle. Despite this, however, we would grade this report no better than a B owing to ongoing disappoint in both labor force growth and earnings, two key ingredients needed to sustain a long and prosperous recovery…. A casual look at these numbers reinforces what has been a very strong jobs market over the past year, the strongest for job creation in 15 years. We are left wanting, however, because an extra 62,000 jobs in an economy employing 140 million does not really change what we already knew going into this report. We needed to see affirmation that wage inflation was indeed beginning to pick up and the recent strength in the labor force would be sustained. On both counts this was a bad print.” –Eric Green, TD Securities
“Unfortunately, as great as the headline is, the wage data severely complicates matters. Average hourly earnings actually declined 0.2% in the month and the previous month was revised down. The simple fact is we cannot consider an employment report a success, no matter how healthy the headline may be, if wage data does not begin to accelerate.” –Dan Greenhaus, BTIG
