Key takeaways

  • The Bureau of Labor Statistics (BLS) reported that the U.S. economy added 216,000 jobs in December.
  • Unemployment held at 3.7% and hiring was revised lower in prior months.
  • A spike in government and health care jobs underpinned the surprising gain in employment in the last month of 2023.


Luke Conway

Senior Associate, J.P. Morgan Wealth Management

Outpacing expectations

The U.S. labor market added 216,000 jobs in December,1 outpacing economists’ expectations and higher than November’s gain of 173,000, closing out 2023 with a more robust labor market than economists expected.

Global Investment Strategist for J.P. Morgan Wealth Management, Shawn Snyder, noted that the labor market remained strong despite indicators that suggest it should be waning.

“The labor market remains in solid shape with the U.S. economy adding 216,000 jobs in the month of December,” said Snyder. “Leading economic indicators continue to suggest that the pace of job growth should slow over the next couple of quarters, but thus far, the labor market hasn’t seemed to get the message.”

Unemployment rates and growth

The overall unemployment rate remained unchanged at 3.7%. The labor force participation rate, at 62.5%, and the employment-population ratio, at 60.1%, both decreased by 0.3% in December, and showed little or no change over the year.

Hiring was revised down in both October and November. For all of 2023, employers added 2.7 million jobs, or an average monthly gain of 225,000 jobs. This was lower than the increase of 4.8 million in 2022 (with an average monthly gain of 399,000), but a bigger gain than in the years preceding the pandemic.

“Moving forward, we intend to keep a close eye on the weekly jobless claims number, which logs the number of people filing for unemployment insurance,” said Snyder regarding the slowing pace of job growth. “We would be more worried about a recession if we were to see a sustained rise in that metric, but there appears to be little to worry about at the moment.”

Government, health care and leisure and hospitality led the month’s job gains. Government jobs gained 52,000 last month. On average, government added 56,000 jobs per month in 2023, more than double the average monthly gain of 23,000 in 2022. The economy added 38,000 jobs in the health care space. Job growth in health care averaged 55,000 per month in 2023, compared with the average monthly gain of 46,000 in 2022.2

Employment in social assistance rose by 21,000 in December, while construction jobs added 17,000. Transportation and warehousing lost jobs. Leisure and hospitality added 40,000 jobs, about the same number as the prior month. The industry added an average of 39,000 jobs per month in 2023, less than half the average gain of 88,000 jobs a month in 2022. Employment in this sector is about 1% below its pre-pandemic February 2020 level.3

Employment in manufacturing, retail trade and professional and business services also added jobs.

Wage growth ticked up slightly last month. Average hourly earnings, an important measure for inflation, rose 0.4% to $34.27. Over the past 12 months, average hourly earnings have increased by 4.1%.4

The number of unemployed Americans who want a job climbed to 5.7 million in December and was up by 514,000 overall in 2023.

Rate implications

The labor market is a key indicator in the Federal Reserve’s interest rate hiking decisions as it continues to battle inflation which is still running above the Fed’s 2% target. At the most recent Federal Open Market Committee (FOMC) meeting last month, the Fed held its benchmark overnight interest rate steady at 5.25% to 5.5%, and indicated it is likely done with its tightening campaign, penciling in three rate cuts in 2024.

But, as Snyder put it, the report was “sort of ho-hum.” Yet it did have some brief impact on rate cut expectations.

“Following the report, the market pushed back its timing of a first rate cut from the Fed, but then the ISM services index came in soft and essentially negated the market’s initial reaction to the jobs report,” said Snyder. “It would not be surprising to see markets whipsawed a bit in coming months as investors remain on edge about the ultimate rationale for lower interest rates. Will it be because the Fed accomplished its mission? Or will it be because the economic slowdown is picking up steam? We lean towards the former, but it’s going to take some time to confirm that.”

With the labor market demonstrating continued resiliency, the Fed might not be in any rush to initiate a rate cut. But, there are signs the job market is cooling – the number of job openings fell in November to 8.79 million from 8.85 million in the prior month, according to the Bureau of Labor Statistics’ Job Openings and Labor Turnover Summary report released this week.5

But overall labor demand is still solid, which, combined with the steady easing in inflation (the Consumer Price Index came in at 3.1% in November compared to a year earlier and down from over 9% in 2022),6 has stirred optimism that the Fed can execute an economic soft landing – lowering inflation without a severe slowdown and attendant spike in unemployment.

In the press conference following the Federal Open Market Committee decision last month, Fed Chair Jerome Powell said that while “there’s little basis for thinking the economy is in a recession now… there’s always a real possibility there will be recession in the next year.”

The December inflation report is set to be released January 11.



Bureau of Labor Statistics, “Employment Situation Summary (December).” (Jan. 5, 2023)


Bureau of Labor Statistics, “Employment Situation Summary (December).” (Jan. 5, 2023)






Bureau of Labor Statistics, “November Job Openings and Labor Turnover Summary.” (Jan. 3, 2024)


Bureau of Labor Statistics, “November 2023 Consumer Price Index.” (Dec. 12, 2023)

Connect with a Wealth Advisor

Our Wealth Advisors begin by getting to know you personally. To get started, tell us about your needs and we’ll reach out to you.

Connect now



This material is for informational purposes only, and may inform you of certain products and services offered by J.P. Morgan’s wealth management businesses, part of JPMorgan Chase & Co. (“JPM”). Products and services described, as well as associated fees, charges and interest rates, are subject to change in accordance with the applicable account agreements and may differ among geographic locations. Not all products and services are offered at all locations. If you are a person with a disability and need additional support accessing this material, please contact your J.P. Morgan team or email us at for assistance. Please read all Important Information.

Any views, strategies or products discussed in this material may not be appropriate for all individuals and are subject to risks. Investors may get back less than they invested, and past performance is not a reliable indicator of future results. Asset allocation/diversification does not guarantee a profit or protect against loss. Nothing in this material should be relied upon in isolation for the purpose of making an investment decision. You are urged to consider carefully whether the services, products, asset classes (e.g. equities, fixed income, alternative investments, commodities, etc.) or strategies discussed are suitable to your needs. You must also consider the objectives, risks, charges, and expenses associated with an investment service, product or strategy prior to making an investment decision. For this and more complete information, including discussion of your goals/situation, contact your J.P. Morgan representative.

NON-RELIANCECertain information contained in this material is believed to be reliable; however, JPM does not represent or warrant its accuracy, reliability or completeness, or accept any liability for any loss or damage (whether direct or indirect) arising out of the use of all or any part of this material. No representation or warranty should be made with regard to any computations, graphs, tables, diagrams or commentary in this material, which are provided for illustration/reference purposes only. The views, opinions, estimates and strategies expressed in this material constitute our judgment based on current market conditions and are subject to change without notice. JPM assumes no duty to update any information in this material in the event that such information changes. Views, opinions, estimates and strategies expressed herein may differ from those expressed by other areas of JPM, views expressed for other purposes or in other contexts, and this material should not be regarded as a research report. Any projected results and risks are based solely on hypothetical examples cited, and actual results and risks will vary depending on specific circumstances. Forward-looking statements should not be considered as guarantees or predictions of future events.

Nothing in this document shall be construed as giving rise to any duty of care owed to, or advisory relationship with, you or any third party. Nothing in this document shall be regarded as an offer, solicitation, recommendation or advice (whether financial, accounting, legal, tax or other) given by J.P. Morgan and/or its officers or employees, irrespective of whether or not such communication was given at your request. J.P. Morgan and its affiliates and employees do not provide tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any financial transactions.

Legal Entity and Regulatory Information.

J.P. Morgan Wealth Management is a business of JPMorgan Chase & Co., which offers investment products and services through J.P. Morgan Securities LLC (JPMS), a registered broker-dealer and investment adviser, member FINRA and SIPC. Insurance products are made available through Chase Insurance Agency, Inc. (CIA), a licensed insurance agency, doing business as Chase Insurance Agency Services, Inc. in Florida. Certain custody and other services are provided by JPMorgan Chase Bank, N.A. (JPMCB). JPMS, CIA and JPMCB are affiliated companies under the common control of JPMorgan Chase & Co. Products not available in all states.

Bank deposit accounts and related services, such as checking, savings and bank lending, are offered by JPMorgan Chase Bank, N.A. Member FDIC.

This document may provide information about the brokerage and investment advisory services provided by J.P. Morgan Securities LLC (“JPMS”). The agreements entered into with JPMS, and corresponding disclosures provided with respect to the different products and services provided by JPMS (including our Form ADV disclosure brochure, if and when applicable), contain important information about the capacity in which we will be acting. You should read them all carefully. We encourage clients to speak to their JPMS representative regarding the nature of the products and services and to ask any questions they may have about the difference between brokerage and investment advisory services, including the obligation to disclose conflicts of interests and to act in the best interests of our clients.

J.P. Morgan may hold a position for itself or our other clients which may not be consistent with the information, opinions, estimates, investment strategies or views expressed in this document.  JPMorgan Chase & Co. or its affiliates may hold a position or act as market maker in the financial instruments of any issuer discussed herein or act as an underwriter, placement agent, advisor or lender to such issuer.