November Employment Gains Surpass Expectations - December 7, 2012
Generally good news on the employment front came over the wires earlier this morning, as a report issued by the U.S. Labor Department at 8:30AM (EST) affirmed that the nation added an estimated 146,000 jobs last month. That was well ahead of expectations of 80,000 and some dour individual forecasts that were as low as 40,000. Also, the unemployment rate fell from 7.9% in October to 7.7% last month. That, too, was better than expectations of a 7.9% rate.
Now, 146,000 jobs added in and of itself, is not a compelling figure. However, that number must be kept in some perspective, as it was reduced by the dislocations caused by Hurricane Sandy, which struck the East Coast on October 29th. However, the Labor Department's report suggested that the reductions were modest--but not quantified.
Also, the payroll figures for both September and October were revised lower. Specifically, job growth in September was reduced from an earlier estimate of 148,000 to a gain of 132,000. At the same time, the initial estimate for October of 171,000 was pared back to 138,000.
Meanwhile, the jobless rate, which, as noted, fell back to 7.7%, is now the lowest it has been since December of 2008, when the nation was in the depths of the agonizingly long and severe recession. The unemployment rate tends to be a lagging indicator, so that improvement has been very slow and uneven for much of the three-year economic recovery. But the trend has become a little steadier in recent months, and is much better than many economists had been predicting. Still, part of the latest drop in the jobless rate reflected people leaving the job market rather than a more sustained reduction in joblessness.
As to some other details in the report, private sector payrolls rose by 147,000 last month, meaning that government employment eased by just 1,000 jobs in November. Also, average hourly wages ticked up by four cents, while the average workweek held steady at 34.4 hours.
Taken as a whole, and even allowing for the downward revisions over the past two months, and the fact that some of the reduction in the latest unemployment rate was caused by people leaving the labor market, the report was still welcome news. So, assuming a compromise can be fashioned in Washington to avoid the so-called fiscal cliff--which is by no means certain at this point--the maturing business upturn should persist into the New Year, and even, perhaps, slowly tack on some momentum.