Market Update: We break down the business implications, market impact, and expert insights related to Market Update: U.S. Hiring Continues at Modest Pace, but Weaknesses Are Evident – Full Analysis.
The American labor market has entered 2026 in respectable shape, continuing to muddle through challenges even as it loses strength.
Employers continued to hire modestly in December and the unemployment rate declined, federal data showed on Friday, but hiring across 2025 was the weakest in five years, driven in part by government staffing cuts and tumultuous public policy.
Employers added 50,000 jobs in the last month of 2025 and the unemployment rate fell to 4.4 percent, the data showed. Average hourly earnings grew at 0.3 percent on a monthly basis in December and 3.8 percent on an annual basis, an acceleration compared with previous months.
The report was the latest in a run of economic updates after several releases were delayed or canceled because of the federal shutdown. Those updates on the economy have demonstrated resilient growth and spending but prolonged softness in the labor market.
Excluding health care and social-assistance sectors that added about 700,000 jobs last year, private-sector job growth for the year was just over 20,000, said Samuel Tombs, the chief U.S. economist at Pantheon Macro, a research firm.
Those jobs are “to my mind, more a measure of demographics” in an aging society “than they are a measure of consumer or business confidence,” said Lia Taniguchi, the research director at Bullhorn, a cloud-based software provider for the staffing and recruitment industry.