Hiring slowed down in December, due to concerns over the Omicron variant. The miss comes as the Fed is watching employment data very closely.
Economists expected the economy to add 422,000, the biggest increase this year. However, non-farm payrolls were up just 199,000, according to Labor Department data.
The unemployment rate fell to 3.9%, better than the 4.1% estimate.
— Bloomberg Markets (@markets) January 7, 2022
These numbers came after the reports that a record 4.5 million Americans quit their jobs in November. Investors interpreted the numbers as a sign of confidence in the job market.
Rather than clinging to the job they have, employees are shopping around and looking for better opportunities. However, new data may shed a different light on those numbers.
The miss in jobs data could effect monetary policy. Economists expected hot jobs numbers to force the Fed’s hand to cut rates sooner. But, it’s more possible the Fed will back away from its plans and early rate hikes could be less likely.