WASHINGTON — Specialty stores added jobs in December, while department stores and discounters shed jobs, the Labor Department’s monthly employment report showed Friday.
Apparel and specialty stores added 10,300 seasonally adjusted jobs to employ 1.35 million last month, while department stores cut 6,200 jobs to employ 1.32 million. General merchandise stores, a category that includes department stores and discounters, slashed 23,900 jobs to employ 3.24 million.
In the overall economy, employers added 156,000 jobs, falling below economists’ expectations, and the unemployment rate ticked up to 4.7 percent from 4.6 percent in November.
Apparel employers shed 300 seasonally adjusted jobs to employ 130,500, while employment at mills making apparel fabric and yarn fell 700 to 110,900. Textile product mills shed 500 jobs to employ 113,500.
Scott Hoyt, senior director of consumer economics at Moody’s Analytics, said the trend for specialty store employment is “definitely down.”
He noted specialty store employment has registered three straight months of declines, adding that sales growth in the category has been “very modest.” Year-over-year sales growth for specialty stores has been in the 1 percent range, he said.
Somewhat surprisingly, the trend for department stores has improved, Hoyt said, adding, “We actually had three straight months of year-over-year gains.”
But he noted that with Macy’s plan to close 100 stores and lay off 10,000 workers and Sears slated to close 150 stores this year, the improvement will not be sustainable.
In the broader general merchandise category, Hoyt said employment has been improving and among the strongest of the year for year-over-year job growth. But year-over-year sales declines in the general merchandise category could be a drag on employment growth in the near-term, he said.
The outlook for job growth in the first quarter is fairly modest, Hoyt said, while wage growth should accelerate somewhat. Average hourly earnings rose 0.4 percent in December.
Nariman Behravesh, chief economist at IHS Markit, said December’s job report revealed “further evidence of a tightening labor market.”
The gains were broad-based, he said, noting that the strongest gains were in education and health care, followed by trade and transportation, leisure and hospitality, business services and financial services.
One bright note was a rebound in manufacturing employment, Behravesh said, noting that after four months of declines, employment rose by 17,000.
“Two things are noteworthy about the December jobs report. First, payroll jobs growth is trending down,” he said. “With the economy at or near full employment, this is not a bad thing, especially if labor productivity growth strengthens.”
Beharvesh said the job gains of the two last years cannot be sustained, however, “without seriously straining the job market.”
“For the first time in many years, the Federal Reserve is beginning to worry about an overheating labor market,” he said. “The December jobs report will likely add to those worries.”