The December jobs report was a stinker, with only 74,000 net new jobs reported to have been added that month. But what sectors are the culprits? What industries underperformed in job creation, leading to the disappointing result?
To answer, we looked at the recent trend of each of the major categories of employment -- their average number of jobs added in the two months preceding the December report. We then compared their December jobs added or lost to the recent trend. The answer helps explain what was different this month compared to the recent past, when overall job creation was three times as fast. Here's the chart:
As it shows, there were a few sectors where job creation actually outperformed the recent past, namely wholesale and retail trade (which added 13,000 and 17,000 jobs more than their recent average, respectively). That fits with other evidence that the consumer-driven sector of the economy is doing pretty well.
Every other sector underperformed its recent job creation trend in December, though some did more to drag down overall job creation than others. Analysts have seized on job losses in the construction industry (which lost 16,000 jobs, after adding an average of 13,500 a month in the previous two months) as evidence that the weak report was driven by weather. This is indeed a sector highly sensitive to weather, as it is hard to build a house in the middle of a snowstorm.
But as it turns out, construction wasn't the biggest contributor to the disappointing results. That would be the education and health-care sector, and specifically the health care and social assistance subset. That industry has been a stalwart of job creation through the recovery, and averaged 33,500 net new jobs in October and November. But in December, it added no net jobs (health care actually lost 1,000 positions), accounting for fully 23 percent of the underperformance of overall job creation in December compared with the preceding months.
Other big losers were professional and business services (undershooting by 27,500, in no small part due to a strange 24,700 drop in the number of accounting and bookkeeping jobs) and leisure and hospitality (undershooting by 23,500, amid a steep loss of 11,600 jobs in performing arts and spectator sports jobs).
None of those are sectors -- health care, accounting, performing arts -- you would expect to be affected much by weather, suggesting that anybody who wants to put the blame for the weak job growth entirely on weather trends is getting it wrong.