US non-farm payroll employment increased by only 145,000 in December, compared with a consensus estimate of 160,000. 

In addition to the slow payroll growth, average hourly earnings rose by just 2.9%, below the 3.1% projection. December marked the first time that wage gains were below 3% on a year-over-year basis since July 2018.

Despite the disappointing numbers, economists and wealth managers both say the pace of hiring remains enough to keep the longest economic expansion in history on track despite a deepening downturn in a manufacturing sector stung by trade disputes.

READ: US stocks rocket higher as November jobs growth soundly beats estimates

“Decelerating hiring and wage growth shouldn’t be a cause for concern in the context of the encouragingly tight US labour market,” said Robert Alster, head of investment services at Close Brothers Asset Management. “Unemployment is low, and wage growth remains healthily above inflation – this puts more money into consumers’ pockets and supports economic growth.”

In addition, the jobless rate held steady at 3.5%, matching the lowest since 1969. 

Job gains in December came primarily from retail (41,000), leisure and hospitality (40,000) and healthcare (28,000).

Construction rose by 20,000 and professional and business services saw an increase of 10,000, while manufacturing declined by 12,000, transportation and warehousing lost 10,000 and mining fell by 8,000.

However, revisions to the October and November counts brought those two months down by 4,000. The glittering 266,000 initial estimate for November came down by 10,000 while October’s fell from 156,000 to 142,000.

Wall Street reacted negatively to the jobs report, sending the Dow Jones Industrial Average down 67 points to 28,890.08 in afternoon trading.

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