According to the U.S. Labor Department, the payrolls surged in December and the job count for the prior two months was revised sharply higher. This has helped the economy on solid ground despite a troubling international backdrop. Slumping oil prices and slowing growth in China have cast a pall on the outlook for the global economy.
Nonfarm payrolls increased by 292,000 last month, the Labor Department said on Friday, as hiring got a boost from unseasonably warm weather. The unemployment rate held steady at a 7-1/2-year low of 5 percent even as more people entered the labor force, a sign of confidence in the job market.
The robust employment data helped soothe fears about the economy’s health, and suggested recent weakness would largely be contained to the manufacturing and export-oriented sectors, which have been hit by a strong dollar and anemic global demand. Efforts by businesses to whittle down an inventory glut and spending cuts by energy companies have also inflicted pain.
“It gives us a short-term shot in the arm and pushes back the idea that we are headed for a global recession or that weakness in China will sink our economy,” says David Donabedian, chief investment officer at Atlantic Trust Private Wealth Management in Baltimore.