WASHINGTON: The US continued to add jobs in December at the same modest rate as the past two years, underscoring the still frustratingly slow pace of reducing unemployment, official data released Friday showed.
Tepid economic growth and business reticence to step up hiring as government leaders battled to the January 1 deadline to avert the economic crunch of the fiscal cliff meant little significant improvement in the US jobs situation in the final quarter of 2012.
Last month the economy generated 155,000 jobs, and the unemployment rate held at 7.8 percent, around where it has stood since September, Labor Department figures showed.
The number of jobs created was slightly down from November, but close to the monthly average for both 2011 and 2012 of 153,000.
Jim O'Sullivan, chief US economist at High Frequency Economics, said the December data was neither strong nor weak.
"While a 150,000-170,000 per month trend in payrolls is far from booming, it is strong enough over time to keep the unemployment rate moving down," he said.
As has been the pattern, the private sector was the source of gains, adding 168,000 jobs in December, while government authorities at the federal and local levels continued to trim payrolls, by 13,000.
The strongest job generation came from the health care industry, restaurants, manufacturing and construction.
The total number of the officially unemployed was little changed over the last quarter at 12.2 million.
But the average duration of joblessness continued to fall, though nearly 4.8 million people were unemployed for more than 27 weeks.
Analysts said the pace showed the economy is generating enough fresh positions to only slowly pull down the jobless rate over the coming year, after falling 1.3 percentage points over the past two years.
"The issue is whether the labor momentum can be sustained through the first half of this year given the tendency over the past three years for first-quarter strength to give way to second-quarter weakness," said Joseph LaVorgna of Deutsche Bank.
Commenting on the data, the White House gave the same interpretation it has put out for months: that the numbers show that the economy is continuing to heal since the 2008-2009 recession, but also that "more work remains to be done."
It said the legislation signed into law by President Barack Obama Wednesday to avert most of the tax hikes scheduled in the fiscal-cliff budget measures ensured that employers will continue to have incentives to invest and create jobs.
But the same legislation included some tax increases -- importantly, the resumption of a higher rate of social security deductions from paychecks -- that will likely hit consumer spending.
"Since we are now threatened by a debt-ceiling crisis, and face a new headwind from the expiry of the payroll tax cut, it is hard to see employment growth accelerating early in 2013," said Nigel Gault of IHS Global Insight.
"But we do think that the economy's fundamentals are gradually improving, and look for faster growth later in the year to produce an average monthly jobs gain of 170,000 for 2013."
The little-changed jobs picture lent support to the Federal Reserve's December move to explicitly tie its eventual policy tightening to achieving a lower unemployment rate of at least 6.5 percent.
Frustrated by the slow pace of reducing unemployment and the persistently high number of the long-term unemployed, the Fed for the first time set benchmarks for inflation and joblessness to begin lifting interest rates off their near-zero level.
Economist Robert Kavcic at BMO Capital Markets noted another solid 30,000 jobs gain in the construction sector, supporting the growing view that the US housing industry is entering a solid recovery phase.
"Underlying momentum in home-building activity suggests that gains close to this magnitude in construction employment could be here to stay," he said.
US markets were higher in late-session trade after the data, with the S&P 500 gaining nearly half a percent for the day.
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