On Friday, the Bureau of Labor Statistics will release the final jobs report for 2025 — and economists’ estimates vary wildly over what we should expect.
The consensus estimates are for 55,000 jobs to have been added in December, a figure that’s in line with year-to-date job growth but slightly lower than November’s preliminary gains of 64,000 jobs.
But some economists say seasonal factors such as the holiday hiring peak could put December’s monthly total somewhere north of 105,000.
Either way, the unemployment rate is expected to tick down to 4.5% after hitting a four-year high of 4.6% in November, FactSet consensus estimates show.
While data like that would be a seemingly welcome indicator of labor market strength, it more likely would be a “red herring,” said Gregory Daco, chief economist at EY-Parthenon.
“The true, underlying momentum for job growth is likely much softer and has been much softer for some time now,” he said.
Whether it’s 55,000 or even double that, December’s job gains won’t change the story of the labor market in 2025: That, with the exception of the pandemic-distorted 2020, last year’s employment growth was the weakest seen in decades.
“Total job gains for 2025 are on track to be a meager 710,000,” Heather Long, chief economist at Navy Federal Credit Union, said in a statement. “That’s the worst hiring outside of a recession since 2003. Even 2010, on the heels of the Great Recession, was a better year for hiring than 2025.”
For much of the past 12 months, extremely high uncertainty (from sweeping policies such as those related to tariffs); dramatic shifts in the nation’s immigration flows; and, to a much lesser extent, companies testing the AI waters, have resulted in muted employment gains – or even outright losses – across most industries.
The lone exceptions have been health care – an industry growing as a result of an aging population – and leisure and hospitality, which has reaped some of the spoils from an increasingly bifurcated economy.
“Health services is an expensive type of service for most consumers; leisure and hospitality [spending] is a discretionary service for all consumers,” said Nela Richardson, chief economist at payroll company ADP. “These two sectors are consistent with a K-shaped economy where higher-income consumers are driving spending.”
Those two sectors, which make up about 22% of all employment, accounted for 84% of the total job gains seen from January through November 2025. And for the remaining 78%, it’s been a far different story.
The labor market became even more lopsided after April 2025, when President Donald Trump made his biggest and broadest tariff announcement. Sentiment plummeted and uncertainty skyrocketed, stifling hiring plans in the process. From April through November 2025, job gains in health care and leisure and hospitality outpaced the net jobs added across the entire labor market during those eight months.
Pretty much every other industry is in the throes of a “hiring recession,” Navy Federal Credit Union’s Long said.
Data released earlier this week further confirmed the listless state of the broader labor market.
The BLS’ latest Job Openings and Labor Turnover Survey data released Wednesday showed that US businesses sought out fewer workers in November and hiring activity slumped to match its lowest rate in more than a decade (excluding the data- and economy-distorting pandemic).
At the same time, layoff activity remained low in November, along with the rate of people quitting their jobs.
A certain amount of turnover is needed for a healthy labor market and growing economy. But as it stands now, it’s taking months for people to find work as the US jobs market is more like an “exclusive club.”
That low-fire trend likely continued through December, according to new data this week that some economists say suggests a bottoming out for this labor market slowdown may be near.
US businesses’ job cut announcements fell to a 17-month low in December, according to Challenger, Gray & Christmas data released Thursday morning.
Employers announced plans for 35,553 layoffs last month while hiring announcements were the highest for the month since 2022, Challenger noted.
“The year closed with the fewest announced layoff plans all year; while December is typically slow, this, coupled with higher hiring plans, is a positive sign after a year of high job-cutting plans,” Andy Challenger, Challenger’s chief revenue officer, said in a statement.
Additionally, separate data from Bank of America showed there was no acceleration in unemployment payments in the bank’s customer accounts in December.
The bank’s internal data also showed that year-over-year payroll growth was 0.6% in December, up from 0.2% the month before.
“While the labor market still is arguably in a low-hire or low-fire mode, it does look – in our data – as though the worst of the slowdown could be behind us,” David Michael Tinsley, senior economist at Bank of America Institute, told reporters during a call on Wednesday.
December’s jobs report will provide a much cleaner look at the state of the US labor market after the longest-ever government shutdown muddied the gold-standard employment data for the months of October and November.
“It’s not super-certain that we’ll be absolutely past all of the shutdown impacts, so we’ll have to wait and see what the numbers look like,” Oren Klachkin, Nationwide’s financial market economist, told CNN. “But I’d say the December jobs numbers in general should give us a lot better sense as to what’s happening in the economy than we had in the November data.”
