Experts See Downturn in Job Momentum

IRVINE, CA-Despite a pick-up in nationwide job gains in the fourth quarter of 2013, December’s numbers fell short of expectation, causing experts to believe that a decline in labor-force participation is the more significant trend. The Bureau of Labor Statistics reported that 74,000 jobs were added in December, bringing the average monthly gain for the year to 182,000—similar to 2012 statistics.

Peter Muoio, senior associate and economist with Auction.com Research, says the headlines are focusing on the unemployment rate, which fell below 7% to 6.7% during December, rather than the labor-force participation rate. “This brings unemployment close to the 6.5% level the Fed has noted as a point to start raising interest rates, but the composition of this decline will give the Fed pause. The fall in unemployment was caused by a nose-dive in labor-force participation.”