November jobs report

The US economy added 227,000 jobs in November, recovering significantly from sluggish growth of just 36,000 jobs in October.

Friday’s Labor Department report showed an increase in the unemployment rate from 4.1 percent in October to 4.2 percent in November. Average hourly wages rose 0.4 percent month-over-month and four percent year-over-year – both strong increases that beat analysts’ forecasts.

The November jobs report underscored the resilience of the U.S. labor market even as it continues to cool due to the explosive hiring surge during the 2021-2023 post-pandemic recovery. The slowdown partly reflects the impact of increased interest rates that the Federal Reserve has implemented as part of its efforts to curb inflation.

The Federal Reserve raised interest rates 11 times in 2022 and 2023, but the economy continued to expand and grow despite rising borrowing costs for consumers and businesses. Since the beginning of the year, however, there have been initial signs of a weakening in the labor market.

What is the current situation on the job market?

Thomas Simons, a U.S. economist at Jefferies, noted in a commentary that the recovery from October’s strikes and hurricanes likely led to about 60,000 new jobs in November. He suggested that this suggests the labor market is robust enough to absorb most job seekers without fueling worries about rising inflation.

Manufacturing added 22,000 jobs in November, helped by settlements of strikes at Boeing and other companies. Healthcare saw a boost with 54,000 new jobs, while government agencies added 33,000 and bars and restaurants contributed 29,000. In contrast, the retail sector struggled with the loss of 28,000 jobs over the same period.

Americans are experiencing unprecedented levels of job security

Government data released this week showed that the number of layoffs fell to just 1.6 million in October, a figure below the lowest level in the two decades before the pandemic. Meanwhile, job openings rebounded from a three-and-a-half-year low, suggesting companies are still looking for workers despite the recent slowdown in hiring.

The overall economy has shown remarkable resilience, defying expectations that the Federal Reserve’s sharp interest rate hikes would push the country into recession. Despite higher borrowing costs for consumers and businesses, economic growth continues, driven by steady consumer spending and continued hiring by employers.

The economy grew at an annual rate of 2.8 percent from July to September, supported by robust consumer spending. In the last nine quarters, annual economic growth was above two percent in eight of them, while inflation fell sharply from its peak in June 2022 of 9.1 percent to 2.6 percent last month. But ongoing frustration over increased prices under the Biden-Harris administration contributed to voters’ decision last month to return Donald Trump to the White House.

This article contains reporting from The Associated Press