The December jobs report capped a striking slowdown in US hiring. Employers added 50,000 jobs in December and just 584,000 jobs in 2025, down sharply from 2 million in 2024, a reset from the post-pandemic surge that made the Fed’s inflation fight so hard. The unemployment rate ticked down to 4.4%, but the broader story is weak job creation and a labor market that is losing breadth.
Why it matters now. Investors increasingly view the data as a green light for a spring rate cut. Seeking Alpha’s rate-cut in March framing echoes what many desks are now leaning toward: slower job growth reduces pressure on the Federal Reserve to keep policy restrictive. That said, the report is not “all clear.” Wage growth is still described as outpacing inflation, supporting consumer spending even as hiring cools, which is exactly the mix that can keep inflation sticky.
The “who” behind the slowdown is less about layoffs and more about fewer openings and fewer hires. CNBC cited a hiring rate of 3.2% in November and a rising share of long-term unemployed. Long-term unemployment share hit 26% of unemployed workers in December. Job growth has also become narrowly concentrated. Health care accounted for roughly 69% of all 2025 job growth, leaving other sectors feeling like recession even if the topline does not scream it.
Readers should treat March as “live,” but not locked. If hiring stays weak while inflation cools, the Fed has cover to cut. If wages and services inflation stay hot, the Fed may signal patience even with a soft labor backdrop.
