Job creation stateside came to a halt in December as restrictions brought on by surging COVID-19 cases hammered virus-sensitive industries, particularly bars and restaurants, which lost nearly half a million positions for the month.
The U.S. Labor Department reported Friday that non-farm payrolls fell by 140,000. That was below expectations for gains of 50,000 from economists surveyed by Dow Jones.
The unemployment rate was 6.7%, compared to the 6.8% estimate. An alternative unemployment measure which includes discouraged workers and those holding part-time jobs for economic reasons declined to 11.7% from 12%.
It appeared, however, that markets shrugged off the report, likely on the anticipation that it strengthened the case for more stimulus from Congress and reflected a likely temporary reduction in jobs that would be reversed as COVID vaccine distribution accelerated. Stocks were poised for a modest gain at the open.
Since a recovery beginning in May, the economy had recovered 12.3 million of the jobs lost. The biggest hit has come in the hospitality industry, where hotels, restaurants and bars suffered under the yoke of restrictions that limited travel, dining and drinking. December’s job tally showed the impact has intensified.
The industry saw a plunge of 498,000 positions for the month, with most coming in restaurants and bars, which saw a drop of 372,000.
