What you need to know about the November jobs report
The labor market bounced back in November, following a strike at General Motors that put a gray cloud over the U.S. Bureau of Labor Statistics’ monthly jobs report in October. According to the latest report, the economy grew by 266,000 jobs in November. Meanwhile, the unemployment rate dipped to 3.5% and average hourly earnings increased by 7 cents, totaling $28.29. Here are the headlines from November’s report.
Jobs Market Rebounds
Beating out economist expectations of about 180,000, the BLS report showed the strongest job gains of 2019 since January. According to the report, 266,000 jobs were created in November. While hiring was solid across the board, manufacturing (54,000), health care (45,000), and leisure and hospitality (45,000) saw the most job growth last month. However, it’s important to keep in mind that manufacturing’s inflated jobs numbers are largely due to the return of workers from the GM strike.
Adding to more job news, revisions to the two previous job reports revealed an additional 41,000 jobs to the labor market. After these revisions, job gains have average 205,000 over the last three months. “Employers have widened their scope, recruiting people with disabilities or criminal records,” reports the New York Times. “Older baby boomers are working past retirement age and stay-at-home parents are switching to paid employment.” As 2019 draws to a close, U.S. economic expansion is on pace to hit a record 11th year following the recession.
Unemployment Rate Remains Under 4%
The unemployment rate dipped slightly in November, from 3.6% back down to 3.5% to match the lowest level since the end of 1969. Even more noteworthy, perhaps, is that unemployment has now remained under 4% for 20 consecutive months—the longest stretch since the 1960s. According to the Wall Street Journal, “The historically low rate is a sign that most workers who want a job can land one.”
As confidence in the labor market rises, many people are drawn back to the workforce. “We still see pretty healthy underlying labor market conditions,” Morgan Stanley Economist Robert Rosener told the New York Times. “The number of people applying for unemployment benefits remains at historically low levels, and Americans continue to show a willingness to quit their jobs. That tells you that consumers are still pretty confident of labor market conditions.”
Service Sector Expands
Activity within the service sector, which includes health care, finance, agriculture, and construction, expanded in November. Earlier this week, IHS Markitreported a U.S. services index of 51.6 in November, up from 50.6 in October. Meanwhile, the Institute for Supply Managementreported a nonmanufacturing index of 53.9 in November. (For both reports, indexes above 50 indicate an increase in activity, while those below 50 indicate a decrease.) This jibes with BLS findings that showed expansion in not only health care and finance, but also leisure and hospitality. Anthony Nieves, chairman of the Institute for Supply Management, told the Wall Street Journalhe “expects the services sector to remain in growth mode well into 2020.”
Wage Growth Holds Steady
Wages continued to increase in November, up 7 cents, for average hourly earnings of $28.29. Wage growth has risen to 3.1% for the year, which is still lower than the recent 3.4% peak in February, despite a low unemployment rate. According to the Wall Street Journal, “The gains well outpace inflation, but are modest relative to other periods with historically low unemployment.” There could be many reasons as to the stunt in wage growth, but the Wall Street Journal goes on to say that “lackluster productivity growth and the retirement of highly paid baby boomers” are two main reasons to consider.
The next jobs report will be released on January 10, 2020, at 8:30 a.m. EST. In the meantime, see how Monster can help drive job growth at your organization.