The economy added 155,000 jobs in December as the unemployment rate stayed steady at 7.8 percent, the Labor Department reported in the monthly jobs report Friday.
The job additions matched the expectations of economists, who expected the unemployment rate to tick up slightly to 7.8 percent, according to a survey by Bloomberg News. But the rate for November was revised up to 7.8 percent from 7.7 percent, so the rate was unchanged.
The Bureau of Labor Statistics also revised figures for October down to 137,000 from 138,000 and for November up to 161,000 from 146,000.
Jobs were added in the sectors of health care by 45,000, food services and drinking places by 38,000, construction by 30,000 and manufacturing by 25,000.
Now that some of the uncertainty surrounding the "fiscal cliff" has passed, economists are watching whether employers will be more eager to create new jobs.
Peter Hooper, chief economist with Deutsche Bank, said strength in the construction sector is offsetting weakness in the government sector.
"If Washington can successfully navigate through the next potential fiscal crisis in March as the sequester and the debt ceiling come due, underlying improvements in the private economy should show through to stronger job performance," he said. "But failure on that front would spell continued sluggishness in the labor market."
He said the report was consistent with an economy that is expanding at a moderate pace, roughly in line with its longer-term trend.
Stephen Bronars, chief economist with Welch Consulting, said the economy is adding enough jobs to just keep pace with population growth, as employment relative to the population is unchanged over the past year.
"The labor market recovery has not gained any momentum in the past year, which is disappointing," Bronars said. "Job growth needs to be much higher in order to gain back the millions of jobs that were lost in the recession in 2008 and 2009. We are not creating jobs at a sufficient rate for a robust recovery."
On Thursday, the private payroll processor ADP reported that the private sector added 215,000 jobs in December, revised upward from 148,000.
Last month, the Federal Reserve said it will not raise short-term interest rates until the unemployment rate drops below 6.5 percent. In the central bank's meeting minutes released on Thursday, members of the Fed were split on whether to continue stimulating the economy until the end of 2013.
Bronars said the conflicting signals from the report for November indicated that unemployed workers gave up their job search and left the labor force. While the unemployment rate dropped, the size of the labor force, the labor force participation rate and the employment to population ratio also fell substantially.
Bronars had said he expected employers to add 150,000 to 200,000 jobs in December. He expected an increase in the unemployment rate, as more workers join the labor force.
On Wednesday, the Labor Department reported weekly U.S. unemployment claim applications rose to a seasonally adjusted 372,000, an increase of 10,000 from the previous week's revised figure. The holidays likely distorted the data, however, as many state unemployment offices were closed this week.