\n While data like that would be a seemingly welcome indicator of labor market strength, it more likely would be a \u201cred herring,\u201d said Gregory Daco, chief economist at EY-Parthenon.\n <\/p>\n
\n \u201cThe true, underlying momentum for job growth is likely much softer and has been much softer for some time now,\u201d he said.\n <\/p>\n
\n Whether it\u2019s 55,000 or even double that, December\u2019s job gains won\u2019t change the story of the labor market in 2025: That, with the exception of the pandemic-distorted 2020, last year\u2019s employment growth was the weakest seen in decades.\n <\/p>\n
\n \u201cTotal job gains for 2025 are on track to be a meager 710,000,\u201d Heather Long, chief economist at Navy Federal Credit Union, said in a statement. \u201cThat\u2019s the worst hiring outside of a recession since 2003. Even 2010, on the heels of the Great Recession, was a better year for hiring than 2025.\u201d\n <\/p>\n
![\"A](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/01\/gettyimages-2252256215.jpg\")
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\n For much of the past 12 months, extremely high uncertainty (from sweeping policies such as those related to tariffs); dramatic shifts in the nation\u2019s immigration flows; and, to a much lesser extent, companies testing the AI waters, have resulted in muted employment gains \u2013 or even outright losses \u2013 across most industries.\n <\/p>\n
\n The lone exceptions have been health care \u2013 an industry growing as a result of an aging population \u2013 and leisure and hospitality, which has reaped some of the spoils from an increasingly bifurcated economy.\n <\/p>\n
\n \u201cHealth services is an expensive type of service for most consumers; leisure and hospitality [spending] is a discretionary service for all consumers,\u201d said Nela Richardson, chief economist at payroll company ADP. \u201cThese two sectors are consistent with a K-shaped economy<\/a> where higher-income consumers are driving spending.\u201d\n <\/p>\n \n Those two sectors, which make up about 22% of all employment, accounted for 84% of the total job gains seen from January through November 2025. And for the remaining 78%, it\u2019s been a far different story.\n <\/p>\n \n The labor market became even more lopsided after April 2025, when President Donald Trump made his biggest and broadest tariff announcement.<\/a> Sentiment plummeted and uncertainty skyrocketed, stifling hiring plans in the process. From April through November 2025, job gains in health care and leisure and hospitality outpaced the net jobs added across the entire labor market during those eight months.\n <\/p>\n \n Pretty much every other industry is in the throes of a \u201chiring recession,\u201d Navy Federal Credit Union\u2019s Long said.\n <\/p>\n \n Data released earlier this week further confirmed the listless state of the broader labor market.\n <\/p>\n \n The BLS\u2019 latest Job Openings and Labor Turnover Survey data released Wednesday showed that US businesses sought out fewer workers in November and hiring activity slumped to match its lowest rate in more than a decade (excluding the data- and economy-distorting pandemic).\n <\/p>\n \n At the same time, layoff activity remained low in November, along with the rate of people quitting their jobs.\n <\/p>\n \n A certain amount of turnover is needed for a healthy labor market and growing economy. But as it stands now, it\u2019s taking months for people to find work as the US jobs market is more like an \u201cexclusive club.\u201d<\/a>\n <\/p>\n \n That low-fire trend likely continued through December, according to new data this week that some economists say suggests a bottoming out for this labor market slowdown may be near.\n <\/p>\n \n US businesses\u2019 job cut announcements fell to a 17-month low in December, according to Challenger, Gray & Christmas data released Thursday morning.\n <\/p>\n \n Employers announced plans for 35,553 layoffs last month while hiring announcements were the highest for the month since 2022, Challenger noted.\n <\/p>\n \n \u201cThe year closed with the fewest announced layoff plans all year; while December is typically slow, this, coupled with higher hiring plans, is a positive sign after a year of high job-cutting plans,\u201d Andy Challenger, Challenger\u2019s chief revenue officer, said in a statement.\n <\/p>\n \n Additionally, separate data from Bank of America showed there was no acceleration in unemployment payments in the bank\u2019s customer accounts in December.\n <\/p>\n \n The bank\u2019s internal data also showed that year-over-year payroll growth was 0.6% in December, up from 0.2% the month before.\n <\/p>\n \n \u201cWhile the labor market still is arguably in a low-hire or low-fire mode, it does look \u2013 in our data \u2013 as though the worst of the slowdown could be behind us,\u201d David Michael Tinsley, senior economist at Bank of America Institute, told reporters during a call on Wednesday.\n <\/p>\n![\"Job](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/01\/gettyimages-2251250984.jpg\")
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