The U.S. labor market showed minimal growth in December 2025 with only 50,000 jobs added and unemployment holding steady at 4.4 percent, marking the weakest year for job creation since 2020 with only 584,000 positions added throughout 2025 compared to 2 million in 2024.
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Key Takeaways
- Total nonfarm payroll employment increased by only 50,000 jobs in December 2025, with the unemployment rate holding steady at 4.4 percent
- The U.S. economy added just 584,000 jobs throughout 2025, averaging 49,000 per month, compared to 2 million jobs at 168,000 per month in 2024
- Long-term unemployment has increased significantly, with the number of people unemployed for 27 weeks or more rising by 397,000 over the past year to 1.9 million
- Part-time employment for economic reasons grew by 980,000 over the year to 5.3 million, indicating more workers are unable to find full-time positions
- Federal government employment has declined by 277,000 positions, or 9.2 percent, since peaking in January 2025
- Retail trade lost 25,000 jobs in December, with warehouse clubs, supercenters, and general merchandise retailers shedding 19,000 positions
- Average hourly earnings increased 3.8 percent over the past year, reaching $37.02 in December
- Previous employment estimates were revised downward, showing October and November combined employment was 76,000 jobs lower than initially reported
- The federal government shutdown prevented October 2025 data collection, making annual 2025 estimates based on only 11 months of data and not strictly comparable to other years
- Health care job growth slowed substantially in 2025, averaging 34,000 jobs per month compared to 56,000 per month in 2024
Article Summary
The Bureau of Labor Statistics released its employment report for December 2025, revealing a labor market that has significantly cooled from the previous year. Total nonfarm payroll employment increased by just 50,000 jobs in December, while the unemployment rate remained essentially unchanged at 4.4 percent. This modest monthly gain caps off a year in which the economy added only 584,000 jobs total, averaging 49,000 per month. This represents a dramatic slowdown from 2024, when the economy created 2 million jobs at an average monthly pace of 168,000.
The household survey data showed little change across most demographic groups. The unemployment rate for adult men stood at 3.9 percent, matching the rate for adult women. Teenagers faced considerably higher unemployment at 15.7 percent. Among racial groups, unemployment rates were 3.8 percent for White workers, 7.5 percent for Black workers, 3.6 percent for Asian workers, and 4.9 percent for Hispanic workers. The total number of unemployed people was 7.5 million in December.
A concerning trend emerged in long-term unemployment. While the number of people unemployed less than five weeks declined to 2.3 million, the number of long-term unemployed workers — those jobless for 27 weeks or more — held steady at 1.9 million but has increased by 397,000 over the past year. These long-term unemployed now account for 26 percent of all unemployed individuals.
The labor force participation rate remained at 62.4 percent in December, while the employment-population ratio held at 59.7 percent. Both measures have shown minimal movement over the past year. The report notes that 5.3 million people were employed part-time for economic reasons, meaning they would prefer full-time work but either had their hours reduced or could not find full-time positions. This figure has risen by 980,000 over the year.
Among industries, food services and drinking places continued their upward trajectory with 27,000 jobs added in December, maintaining a consistent pace throughout 2025 with an average of 12,000 jobs per month. Health care employment increased by 21,000 in December, with hospitals adding 16,000 positions. However, the health care sector’s growth has slowed considerably, averaging 34,000 jobs per month in 2025 compared to 56,000 per month in 2024. Social assistance continued trending upward with 17,000 jobs added, primarily in individual and family services.
Retail trade experienced losses of 25,000 jobs in December. The sector saw employment decline in warehouse clubs, supercenters, and other general merchandise retailers, which lost 19,000 jobs, and in food and beverage retailers, which shed 9,000 positions. Electronics and appliance retailers provided a bright spot with 5,000 jobs added. Overall, retail trade employment showed little net change throughout both 2024 and 2025.
The federal government sector reflects ongoing workforce reductions. While federal employment changed little in December with just 2,000 jobs added, the report notes that since reaching a peak in January, federal government employment has declined by 277,000 positions, representing a 9.2 percent reduction. The report clarifies that employees on paid leave or receiving ongoing severance pay are still counted as employed in the establishment survey, meaning actual separations from federal service may be even more substantial.
Several major industries showed little change in December, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; transportation and warehousing; information; financial activities; professional and business services; and other services.
Wage growth continued at a moderate pace. Average hourly earnings for all employees on private nonfarm payrolls rose by 12 cents, or 0.3 percent, to $37.02 in December. Over the past year, average hourly earnings have increased by 3.8 percent. The average workweek for all employees on private nonfarm payrolls edged down by 0.1 hour to 34.2 hours in December.
The report included significant revisions to previous months. October employment was revised downward by 68,000 jobs, from negative 105,000 to negative 173,000, while November was revised down by 8,000 jobs, from positive 64,000 to positive 56,000. Combined, these revisions show employment in October and November was 76,000 lower than previously reported.
The December report includes important technical notes about data collection disruptions. The federal government shutdown did not impact December household survey data collection, but it did prevent data collection for October 2025. As a result, the Bureau of Labor Statistics could not produce fourth quarter 2025 estimates for household survey data, since reliable quarterly estimates require data from all three months. Annual estimates for 2025 were produced using 11-month averages that exclude October, making them not strictly comparable to other years.
Looking ahead, the Bureau of Labor Statistics announced upcoming changes. The Employment Situation report for January 2026, scheduled for release on February 6, 2026, will include revised nonfarm payroll employment data reflecting the annual benchmark process and updated seasonal adjustment factors. The establishment survey will also implement changes to its birth-death model by incorporating current sample information each month. Additionally, annual population control adjustments for the household survey will be introduced with the February 2026 estimates in March, rather than with January estimates as is typical.
Bureau of Labor Statistics. “The Employment Situation — December 2025.” U.S. Department of Labor, January 9, 2026. https://www.bls.gov/news.release/pdf/empsit.pdf
Important Quotations
- “Both total nonfarm payroll employment (+50,000) and the unemployment rate (4.4 percent) changed little in December.”
- “Payroll employment rose by 584,000 in 2025 (an average monthly gain of 49,000), less than the increase of 2.0 million in 2024 (an average monthly gain of 168,000).”
- “The number of long-term unemployed (those jobless for 27 weeks or more) changed little over the month at 1.9 million but is up by 397,000 over the year.”
- “The number of people employed part time for economic reasons, at 5.3 million, changed little in December but is up by 980,000 over the year.”
- “Since reaching a peak in January, federal government employment is down by 277,000, or 9.2 percent.”
- “Health care employment rose by an average of 34,000 per month in 2025, less than the average monthly gain of 56,000 in 2024.”
- “With these revisions, employment in October and November combined is 76,000 lower than previously reported.”
- “Over the past 12 months, average hourly earnings have increased by 3.8 percent.”