Job hiring clearly slowing and concentrated in only a few areas/Scratching my head with bond market response

Clean of the UAW strikes and with Hollywood back to work, December payrolls grew by 216k, 40k more than expected but the two prior months were revised down by a net 71k. The private sector added 164k of these jobs. The large increase in the household survey in November was completely offset and then some in December as jobs here fell by 683k and combine that with a large drop in the size of the labor force of 676k kept the unemployment rate at 3.7% and for the wrong reason this time in contrast to November. The all in rate rose one tenth m/o/m to 7.1%.

Pointing to the need for less work but reluctance to fire, hours worked fell to 34.3 from 34.4, the estimate was for no change and that matches the lowest since April 2020. Also, the participation rate fell 3 tenths to 62.5% which is the lowest since February 2023. The key 25-54 yr old group saw a one tenth drop in the participation rate to 83.2%.

Wages grew by .4% m/o/m which was one tenth more than anticipated and higher by 4.1% y/o/y. Combining this with the tick down in hours worked reflects a 3.8% y/o/y average weekly wage gain.

Most of the job gains are taking place in government (52k), private education/health (74k) and leisure/hospitality (40k) which total 166k of the 216k. Manufacturing added 6k, construction 17k, retail 17k and information 14k. Of note, temp jobs fell by 33k which is the 11^th month in a row of declines and coincides with the labor market hiring slowdown.