Jobs report shows hiring slowdown in November
Hiring slowed in November, resuming sluggish performance that has bedeviled the labor market for much of this year and elicited a series of interest rate cuts, a fresh jobs report on Tuesday showed. The reading, however, exceeded economists' expectations.
The U.S. added 64,000 jobs in November, which marked a significant decline from 119,000 jobs added in September, the most recent month for which complete data is available.
The unemployment rate ticked up to 4.6% in November from 4.4% in September, the Bureau of Labor Statistics (BLS) said. Unemployment remains low by historical standards but has inched up to its highest level in years.
As in previous months, the healthcare sector accounted for the lion share of hiring in November, adding 46,000 jobs, the BLS said. The construction and social assistance industries also contributed to the uptick in hiring.
Employment in the federal government declined by a staggering total of 168,000 jobs in October and November, reflecting in large part employees who accepted a deferred resignation offer earlier this year, the BLS said.
Employment in transportation and warehousing declined by 18,000 jobs in November, contributing to combined losses of 78,000 jobs in that sector since February, the BLS said.
The jobs report involves a survey of households meant to gather data on a sample of the overall population, as well as a survey of businesses and government agencies that aims to assess pay and hiring activity among employers. Agency officials did not collect the household survey data for October, the BLS said, meaning the government only released information garnered from businesses.
The BLS extended the period for collection and processing of the November data, which helps explain why the report was issued on a Tuesday in the middle of the month, rather than its customary release on the month’s first Friday.
The fresh jobs data arrived less than a week after the Federal Reserve cut its benchmark interest rate a quarter of a percentage point in an effort to boost the sluggish labor market. The move amounted to the third rate cut this year, bringing the Fed’s benchmark rate to a level between 3.5% and 3.75%.
Interest rates have dropped significantly from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.
Speaking at a press conference in Washington, D.C., on Wednesday, Fed Chair Jerome Powell touted the rate cut as an effort to improve the labor market, but he suggested the central bank may be cautious about further rate reductions.
"We're well-positioned to wait and see how the economy evolves," Powell said.
The Fed is stuck in a bind, since the central bank must balance a dual mandate to keep inflation under control and maximize employment. To address pressure on both of its goals, the Fed primarily holds a single tool: interest rates.
The pressure on both sides of the Fed's dual mandate presents a "challenging situation" for the central bank, Powell said.
"There's no risk-free path for policy as we navigate this tension between our employment and inflation goals," Powell added.
