US employers added 263,000 jobs in November, continuing a surprisingly strong pace of expansion this year despite the Federal Reserve’s efforts to put the brakes on the labor market.
The US Bureau of Labor Statistics said on Friday that the unemployment rate remained at the level of 3.7%. Economists surveyed by data provider FactSet predicted that employers added 200,000 jobs last month.
Job growth was broad-based, with employers in health care, government and leisure and hospitality adding jobs. The information sector grew modestly, despite widespread layoffs among tech companies. While hiring bodes well for job seekers, the stronger-than-expected report complicates the Federal Reserve’s efforts to tame the hottest inflation in four decades, raising fears of more rate hikes to come.
On Friday, Bankrate senior economic analyst Mark Hamrick said, “Even if the central bank relaxes as expected on the magnitude of the rate hike, the journey continues toward a higher final rate destination in 2023 in an attempt to contain inflation.” Is.” Comment.
Stock markets tumbled on the report, with Dow futures down 1.2% and S&P 500 futures down 1.5%. Investors believe that too much hiring could encourage the Fed to raise interest rates even higher.
staffing to meet demand
Economists and labor experts said the stronger-than-expected hiring shows employers are still seeking to fill roles as the labor market recovers from the pandemic.
“Another strong jobs report reflects what to see in the economy: more than 10 million job opportunities and many industries, such as health care and education, still filling their ranks at minimal, pre-pandemic levels.” are working,” said Robert Frick, corporate economist at Navy Federal Credit Union, in a note.
“In addition, industries such as leisure and hospitality need workers to meet consumer demand,” he added.
Transportation and trade lost jobs.
Wage growth also picked up, with average wages rising 5.1% over the last 12 months — still below the rate of inflation, but much higher than the Federal Reserve is expecting as it tries to cool the economy.
Job growth has slowed this year, from an average of 540,000 per month in the first three months of the year to 270,000 in the most recent three months. But the Federal Reserve is looking for a much more pronounced recession, because it believes a tight labor market is contributing to high inflation, despite little evidence that wages are pushing up prices.