U.S. payrolls grow by 155,000 jobs as unemployment holds at 3.7 percent
Friday, December 07, 2018
Nonfarm payroll jobs rose 155,000 in November, down from 250,000 in October, while the rate of unemployment remained at 3.7 percent for the third straight month, the Bureau of Labor Statistics reported. In November, the number of jobless workers was 6.0 million workers versus 6.1 million in October.
November’s jobs report could be a harbinger of slower growth due to the U.S. and China imposing retaliatory import tariffs. That conflict is on pause now, though existing tariff impacts on businesses and consumers continue.
“Over the year, the unemployment rate and the number of unemployed persons declined by 0.4 percentage point and 641,000, respectively,” the BLS reported. For major groups of workers, the unemployment rates remained unchanged from November compared to October.
In the meantime, wage growth is underway. According to the BLS, “Over the year, average hourly earnings have increased by 81 cents, or 3.1 percent.”
November’s employment-population ratio was 60.6 percent (the share of the labor force now on payrolls versus the total working-age population) compared with 60.6 percent in October. Thus, the pace of job growth is keeping up with expansion of the working age population.
Midsize employers (50-499 employees) led the way with 119,000 new hires in November versus 96,000 in October,according to the ADP National Employment Report. Small businesses (1-49 employees) added 46,000 new jobs in November compared with 29,000 in October. Companies of 500 or more workers hired 13,000 employees in November versus 102,000 in October. National franchise employment rose 11,500 in November from 13,200 in October.
ADP’s National Employment Report aggregates America’s nonfarm private sector employment from existing payroll data, according to the ADP Research Institute that collaborates with Moody’s Analytics. ADP reports payroll data, which represents 411,000 U.S. private-sector clients employing nearly 24 million workers in the U.S. In contrast, the BLS surveys businesses and households and counts government jobs.
According to ADP’s report, the service sector of the economy grew by 163,000 new hires in November, down from 189,000 in October.Professional and business services employment rose 59,000 in November versus 36,000 in October. In November, there were 18,000 new jobs in trade, transportation and utilities, a drop from 61,000 in October. Education and health added 49,000 positions in November compared with October’s 31,000 total.
Payrolls in the goods-producing sector grew 16,000 jobs in November from 36,000 in October. Manufacturing and construction firms hired 14,000 workers compared with 17,000 new hires in October, likely due to seasonal factors such as weather. Natural resources and mining companies hiring held steady at 4,000 new workers in November, matching October’s total.
“Although the labor market performed well, job growth decelerated slightly,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, in a statement. ”Midsized businesses added nearly 70 percent of all jobs this month. This growth points to the midsized businesses’ ability to provide stronger wages and benefits. It also suggests they could be more insulated from the global challenges large enterprises face.”
A case in point is the simmering trade dispute between the U.S. and China. That discord has roiled financial markets with uncertainty, a blight to investors. It is unclear when to expect an end to this binational trade conflict.
Amid a growing threat from the world’s two biggest economies levying more tariffs on each other’s imports, the U.S. Federal Reserve Bank is poised to hike interest rates at its December meeting. That would increase lending costs for American companies and buyers of their goods and services.
Under Federal Reserve Chairman Jerome H. Powell, the central bank has increased interest rates in part to counter inflation, higher prices of goods and services. There is disagreement with such policy.
“With inflation still lower than the Fed’s target,” said economist Michael Madowitz with the Center for American Progress in a statement, “there’s no apparent need to hike rates in two weeks, and there seem to be real risks facing the longest expansion in U.S. history.”
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