Job growth slowed in the U.S. last month as a game of high-stakes chicken on Capitol Hill held the nation hostage, with the potential unresolvedness of fiscal cliff debates threatening to stall economic growth in the New Year if the cliff’s automatic spending cuts and tax hikes were allowed to go into effect.
Payrolls outside the farming sector grew 155,000 in December, roughly in line with estimates and slightly below the level for November. The jobless rate held steady at 7.8 percent.
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Today, the Labor Department raised its estimate for the unemployment rate in November to 7.8 percent, from an initially reported 7.7 percent.
Growth has been slow, in part, due to weak household spending as consumers try to reduce their debt burdens and create safety nets for uncertain futures. Economists believe this trend will continue in the New Year, while tax hikes also hit consumer spending.