2015 US job growth fueled by health care, business services – Consumer borrowing rises $14 billion in Nov

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This Sept 9, 2015 file photo shows an employee serving customers in a Chipotle restaurant in Washington, DC. The US jobs machine picked up pace in December, generating a huge 292,000 net new positions to stifle doubts that the economy could be slowing down. The Labor Department reported Jan 8, 2016 that job creation for the previous two months was also significantly stronger than originally reported, though wage gains still did not reflect much tightening of the labor market. The unemployment rate held at 5.0 percent. (AFP)
This Sept 9, 2015 file photo shows an employee serving customers in a Chipotle restaurant in Washington, DC. The US jobs machine picked up pace in December, generating a huge 292,000 net new positions to stifle doubts that the economy could be slowing down. The Labor Department reported Jan 8, 2016 that job creation for the previous two months was also significantly stronger than originally reported, though wage gains still did not reflect much tightening of the labor market. The unemployment rate held at 5.0 percent. (AFP)

WASHINGTON, Jan 9, (AP): Nearly all sectors of the US economy contributed to the stellar job gains in 2015. But three stood out for their sheer volume of hiring: Professional services, health care and restaurants.

Professional and business services added 605,000 jobs last year. That category includes accountants, architects, attorneys, administrative services and temporary workers.

Health care alone accounted for more than 474,000 new jobs, thanks to robust hiring by hospitals, clinics and nursing homes.

More jobs led to more spending on leisure, particularly eating out. Restaurants and bars boomed, and they added more than 357,000 jobs.

In December, US employers added a robust 292,000 jobs, bringing the year’s total job growth to 2.65 million. The unemployment rate held steady at 5 percent.

Wages were the one weak spot in December, as average pay slipped a penny to $25.24 an hour. Hourly pay has risen 2.5 percent in the past year, only the second time since the Great Recession ended in mid-2009 that it’s reached that level. Yet pay growth remains below the roughly 3.5 percent pace typical of a healthy economy.

The US “is uniquely positioned among the major industrial economies to withstand a global slowdown,” Vitner said.

Global trade accounts for just about 30 percent of US economic activity, one of the lowest such percentages in the world, according to Patrick O’Keefe, director of economic research at the consulting firm CohnReznick.

A resilient US economy will probably help some other countries by drawing in more imports, especially as a higher-valued dollar holds down the prices of foreign goods. The World Bank said this week that Mexico and emerging markets in Central America should fare better than the rest of South America because of their proximity to the healthier US economy.

Still, the effect could be limited if Americans’ spending remains concentrated in services — from restaurants to health care — rather than factory goods.

At the same time, Friday’s solid jobs report could make it more likely that the Federal Reserve will further raise rates after announcing its first increase in nearly a decade last month. Steady hiring would reduce the supply of people seeking jobs, which could lead to higher pay and possibly help lift inflation closer to the Fed’s 2 percent target.

Many economists expect the Fed to raise its benchmark rate three times this year. Stuart Hoffman, chief economist at PNC Financial Services, said the robust jobs data means the next increase will probably be in March.

The jobs report contained no signs of inflation. That led other economists such as Alan Levenson at T. Rowe Price to say that Fed officials may need to see prices climb more before raising rates again.

Signs emerged this week that China’s economy may be slowing more than expected. Its manufacturing activity shrank last month for the 10th month in a row. And China’s central bank let its currency, the yuan, weaken, a move that could help its exporters.

In a separate report, US consumers boosted their borrowing in November, as higher credit card spending partially offset slower growth in auto and student loans.

Consumer borrowing rose $14 billion in November to a fresh record high of $3.53 trillion, the Federal Reserve said Friday. Economists believe that strong job gains in the labor market will boost consumer confidence and convince households to finance purchases by taking on more debt.

For November, the category that covers credit cards increased $5.7 billion after a much smaller $65 million gain in October.

The category that covers auto loans and student loans rose by $8.3 billion. That was the smallest monthly gain for this category in more than three years.

In its monthly credit report, the Fed does not break down auto loans and student loans in the seasonally adjusted data. However, analysts said they believed the slowdown occurred in student loans given that car sales have been so strong in recent months.

The overall monthly gain of $14 trillion was slightly below the October gain of $15.6 trillion. It was the smallest overall gain since an increase of $10.8 billion last January.

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