The U.S. economy had a net gain of 292,000 jobs in December, a sign that the world's largest economy is growing at a solid pace in spite of recent global stock market turmoil and other headwinds.
Friday's report from the Labor Department says the unemployment rate was five percent, where it has been for the past three months, and the lowest rate in more than seven years.
The job gains are far larger than most economists expected, with business services, construction, health care, and restaurants adding tens of thousands of workers. The mining sector, which includes the oil industry, continued to shed jobs due to low oil prices.
While the report is better than most economists predicted, it still shows 7.9 million people out of work, and another 6 million who can find only part-time employment.
The data show the economy gained an average of 221,000 jobs per month over the past year. White House economic advisor Jason Furman says the economy now needs to gain only 77,000 jobs per month to keep the unemployment rate steady because many members of the very large baby boom generation are retiring and leaving the workforce.
Slow or stagnant wage growth has worried policymakers and frustrated workers for a number of years. PNC Bank economist Gus Faucher says wages advanced 2.5 percent over the past year, and the low unemployment rate is the reason they are “finally accelerating.”
S&P economist Beth Ann Bovino says the strong job report means the U.S. central bank is likely to continue raising interest rates. During the financial crisis, the key rate was cut nearly to zero to bolster growth and jobs. The Federal Reserve says the recovering economy no longer needs such emergency help. Bovino says the Fed may boost rates four times this year.