The U.S. labor market stumbled to the finish line in 2025, adding 50,000 jobs in December, according to the Bureau of Labor Statistics employment report released Friday.

The December figures fell short of economists’ expectations of 73,000 new positions.

For all of 2025, employers added just 584,000 jobs, averaging 49,000 per month. During the two years prior, more than 2 million positions created in each year. This is the worst annual employment performance outside of a recession since 2003.

The unemployment rate was 4.4% in December from a downwardly revised 4.5% in November. However, the labor force participation rate declined slightly to 62.4% from 62.5%.

The number of discouraged workers, those who believe no jobs are available, decreased by 183,000 to 461,000.

Growth sectors included food services and drinking establishments, which added 27,000 positions in December and averaged 12,000 jobs per month throughout 2025. Healthcare employment rose by 21,000 in December, though the sector’s monthly average of 34,000 jobs is a slowdown from the 56,000 monthly average in 2024. Social assistance added 17,000 positions, primarily in individual and family services.

Retail trade shed 25,000 jobs in December, with losses concentrated in warehouse clubs, supercenters, and food and beverage retailers. For the full year, retailers announced 92,989 job cuts. Manufacturing lost 68,000 jobs in 2025, while business and professional services shed 97,000 positions. 

Federal employment plummeted by 277,000 positions, or 9.2%, since peaking in January 2025. The cuts, attributed to DOGE Actions and related initiatives, accounted for 293,753 planned layoffs nationwide.

Average hourly earnings rose 0.3% in December, bringing the annual wage growth rate to 3.8%.

Adding to concerns, the BLS revised previous months’ figures downward. November’s job gains were reduced from 64,000 to 56,000, while October’s job losses were revised to a more severe 173,000 from the initially reported 105,000. The combined revisions mean employment for October and November was 76,000 lower than previously reported.