The Brookings Institution reports
For the fifth successive month the Bureau of Labor Statistics (BLS) household survey showed sizeable employment gains, gains that were fast enough to reduce the unemployment rate to 8.5%. There can be little doubt that the household survey shows a faster rate of job growth than the one needed to keep up with the growth in the population.
Since July the fraction of adults who report holding a job has increased 0.3 percentage points. To be sure, the gains have been modest compared with the drop in the employment-to-population rate caused by the Great Recession. (Between December 2007 and July 2011 the adult employment rate fell a total of 4.5 percentage points.) Still, the employment picture is much brighter in December than it seemed in July.
According to the household survey, an additional 176,000 Americans found jobs in December, capping a 5-month period in which employment gains totaled 1.34 million. Over the same period the ranks of the unemployed fell by 811,000 and the unemployment rate shrank 0.6 percentage points. For the first time since July, the BLS employer survey showed faster job gains than those estimated in the household survey. Employers report that their payrolls went up 200,000 in December.
Private sector payroll gains were spread across a variety of industries in December, including construction, manufacturing, wholesale and retail trade, transportation, health care, and food services. Government employment shrank in December as it has in all but two months since July 2010. Encouragingly, the rate of public employee job loss slowed in the second half of 2011. In the first half of 2011, public-sector payrolls shrank an average of 34,000 a month; in the second half of the year, employment fell only about 13,000 a month.
