Or maybe just with the background painted.
The easiest way to make the back, whether it's to be a wreath or just painted is to use hole saws. Use 1/4" wood and select a hole saw for the inside diameter and drill nearly all the way through the 1/4" wood. Next select a hole saw about 1/4" larger in diameter, and using the same drilled hole drill all the way through. Use a gouge to remove the wood from the inside.
Whittle the Santa on the corner of a piece of Basswood to fit inside the rim of the pin / ornament.
If the rim is to be a wreath, use a small sanding sleeve and a rotary tool to randomly remove wood to leave a holly like wreath. Paint the wreath, apply finish to the Santa, and glue the Santa in place, then add either a pin back or an eye screw to the piece.