The jobless rate was unchanged at 3.7 per cent in November, matching estimates. Federal Reserve Chairman Jerome Powell said late Thursday that the US labor market is “very strong” by many measures and that the economy is “performing very well overall.”
Even so, one key risk is the trade war between the US and China, the world’s two largest economies. While the nations agreed last weekend on a 90-day pause for new tariffs, the accumulated levies and developments have created uncertainty for companies and may weigh on the employment outlook.
Retailers showed solid demand for workers overall, hiring 18,200 people in the month before Christmas; general-merchandise stores added the most employees while clothing and electronics stores cut workers. Transportation and warehousing, a category closely linked to retail, also saw gains of 25,400 in the month.
Construction jobs rose by 5,000, the weakest since a decline in March, as gains cooled among residential specialty trade contractors. Manufacturing remained strong at an increase of 27,000.
The monthly gain in average hourly earnings for all private workers followed a downwardly revised 0.1 per cent increase, the report showed. The annual increase topped 3 per cent for a second month, reflecting how companies are steadily raising pay to attract and retain workers as the availability of workers tightens.
The gains probably still aren’t fast enough, though, to spur concerns of runaway inflation among Fed officials. While the unemployment rate is well below the level that central bankers consider sustainable in the long run, inflation has remained close to the central bank’s target, leading some to question whether the Fed should keep raising interest rates.
Here are other highlights from the report:
- Revisions subtracted 12,000 jobs from payrolls in the prior two months, resulting in a three-month average gain of 170,000.
- Private payrolls rose by 161,000, compared with the median estimate for 198,000; government payrolls decreased by 6,000.
- Service providers added 132,000 jobs, including 40,100 in health care and social assistance. The 32,000 gain in professional and business services was the smallest since December 2017.
- Average hourly earnings for production and non-supervisory workers increased 3.2 per cent from a year earlier, following 3.2 per cent in the prior month.
- The average work week decreased to 34.4 hours from 34.5 hours in the prior month; a shorter workweek has the effect of boosting average hourly pay.
- The participation rate was unchanged from the prior month at 62.9 per cent. The measure tracks share of working-age people either with jobs or actively looking.
- The employment-population ratio, another broad gauge of labor-market health, was unchanged at 60.6 per cent.
- The U-6, or underemployment rate, rose to 7.6 per cent from 7.4 per cent. This measure includes part-time workers who want a full-time job and people who are less active in seeking work.