Amid Chinese Uncertainty, U.S. Economy Shows Strength With Jobs Report
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With this week's rough stock market performance, Americans needed some assurance that the economy is still on track. That came today in the monthly jobs report. The Labor Department said in December employers added roughly 300,000 jobs. NPR's John Ydstie reports.
JOHN YDSTIE, BYLINE: China worries have been at the center of this whirlwind. Its stock market sold off this week, and its currency fell as concerns mounted about a slowdown in its economy. U.S. investors feared China's problems could threaten growth here, too. But the report that the U.S. economy added 292,000 jobs in December demonstrates the staying power of U.S. growth, says Rob Martin, chief U.S. economist at Barclays Investment Bank.
ROB MARTIN: We feel confident that the economy is in a great spot, and it is very likely to withstand any kind of headwinds coming from turbulence in the Chinese economy.
YDSTIE: While some U.S. exporters could be hurt, Martin thinks the money U.S. consumers save from lower prices for imported Chinese goods will boost economic activity and more than offset any drag on U.S. growth. Dean Baker, co-director of the Center for Economic and Policy Research, says there's another positive sign in this report.
DEAN BAKER: Many of the people who dropped out of the labor force may now finally be coming back.
YDSTIE: The labor force grew by almost 470,000 workers in December after a big gain in November. That suggests workers have more confidence that the economy will provide them a job. One negative in the jobs report today was wages. They were flat in December. Baker says they're not growing at a healthy pace because there are still millions of people out of work who are competing for jobs. And there are other concerns, says Baker. Many economists have trimmed their estimates for U.S. growth because of data showing a slowdown in manufacturing and construction.
BAKER: So I worry that we might see some slowing of the economy, and, of course, the fallout from China would be another factor. So that's one issue. The other is the response of the Fed.
YDSTIE: After today's strong jobs report, many economists are predicting the Fed will remain on track to boost interest rates another full percentage point during 2016. Baker fears that could slow economic growth, hurt job seekers and deprive workers of higher wages. John Ydstie, NPR News, Washington. Transcript provided by NPR, Copyright NPR.