A Quick Review of U.S. (December 2021) Employment Report and the Main Reason U.S. Real GDP Growth Will Slow In 2022?
Generating faster economic growth requires the presence of spare capacity. In contrast, tight labor markets signal firms will face challenges compared to when the U.S. Unemployment Rate stood at 14.8% (April 2020).
With a current Unemployment Rate of 3.9% in December 2021, we are hovering near the 3.5% rate observed before the start of the Covid-19 pandemic ( March 2020).
Summary of U.S. Employment Conditions
In 2021, the U.S. economy enjoyed a robust gain of +6.4 million in non-Farm payrolls (Establishment Survey) and +6.1 million in Employment (Household Survey). These figures stand in stark contrast to the 22.4 million jobs (Establishment Survey), and 25.4 million jobs (Household Survey) lost during the severe 2020 Recession. At present, both U.S. Employment Surveys are still missing 3.6 million Non-Farm Payrolls and 2.9 million Employment positions, respectively. And for those worried that the Household Survey Employment came in hot in December (+651k) versus the Establishment Survey (+199k), the annual gains ended the year close to each other.
