Hiring slows in December to end the weakest year of job growth since the pandemic

Hiring remained anemic in December, closing out the weakest year for job growth since the beginning of the pandemic.

U.S. employers added just 50,000 jobs last month, according to a report Friday from the Labor Department. Meanwhile, the unemployment rate dipped to 4.4%, from 4.5% in November, while job gains for October and November were also revised down by a total of 76,000 jobs.

For all of 2025, employers added 584,000 jobs — compared to 2 million new jobs in 2024. That meant that last year was the worst for employment growth since 2020.

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Health care and hospitality were among the few industries adding jobs in December. Health care employment is generally immune from ups and downs in the business cycle.

Manufacturing continues to lose workers, cutting 8,000 jobs in December. Factories have been in a slump for the last 10 months, according to an index of manufacturing activity compiled by the Institute for Supply Management. The sector has been hit hard by President Trump's tariffs, since many domestic manufacturers rely on some foreign components.

"Morale is very low across manufacturing in general," said an unnamed factory manager quoted in this week's ISM report. "The cost of living is very high, and component costs are increasing with folks citing tariffs and other price increases."

The federal government added 2,000 jobs in December, but is still down 277,000 jobs from the beginning of the year. The government recorded big job losses earlier in the fall, when workers who accepted buyouts officially dropped off the government's payroll.

While unemployment remains low by historical standards, workers are increasingly nervous about job security. A survey last month by the Federal Reserve Bank of New York found workers slightly more worried about losing their job in the coming year, and less confident about finding a new job if they are laid off.

The slowdown in hiring makes people who already have jobs reluctant to give them up. The resulting lack of turnover means fewer job openings for young people and others trying to get a foot in the door.

Concern about the weakening job market prompted the Federal Reserve to cut its benchmark interest rate in December for the third time since September.
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