US enjoys job creation boost

THE United States has clocked up its best year for job creation since the end of the last century with the number of people in work rising by nearly 3m in 2014.

Figures from the Labor Department said so-called nonfarm payrolls – a crucial measure of the health of the world’s biggest economy – rose by 252,000 in December.

It meant 2.95m jobs were created in 2014, the most since 1999, while unemployment has fallen to 5.6pc, the lowest level since 2008.

But it was not all good news for the US with average hourly pay slipping 0.2pc last month.

Part of the fall in the jobless rate was due to unemployed Americans giving up looking for work altogether – meaning they are no longer deemed unemployed.

The figures will be pored over by officials at the US Federal Reserve amid widespread expectations that they will soon raise interest rates from their historic lows of between zero and 0.25pc.

Mohamed El-Erian, chief economic adviser at Allianz in Newport Beach, California, said: ‘With the exception of disappointing wage growth, the US delivered another month of strong job creation in December, capping an impressive employment year. It is a matter of time until wages pick up.’

Paul Dales, senior US economist at Capital Economics in London, said: ‘There has been a clear acceleration in job growth since last summer, a faster decline in the unemployment rate, but few signs of faster wage growth.

‘If the activity data continue to improve, as we expect, then the Fed may not wait for wage growth to rise and could still raise rates as soon as March.’