December Jobs Report Commentary from MBA's Mike Fratantoni

The following is MBA SVP and Chief Economist Mike Fratantoni’s reaction to this morning’s U.S. Bureau of Labor Statistics report on employment conditions in December.

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“The job market strengthened in December, with payrolls increasing by 256,000 for the month and capping a year of faster-than-expected job gains. The unemployment rate decreased to 4.1%, and wage growth decreased slightly to 3.9%.

“The job gains were predominantly in retail trade, health care, leisure and hospitality, and government sectors, while the manufacturing sector continued to contract.

“In recent months, there had been increases in the share of workers who were unemployed for longer spells. Although other data continue to report that hiring rates remain quite low, in December, the number of long-term unemployed individuals decreased.

“The December employment report is a picture of a strong job market. While the FOMC had indicated that they could slow the pace of rate cuts as we enter 2025, these data make at least a pause in cuts much more likely, which will push mortgage rates higher in the near term.”