The United States added 227,000 jobs in November, rebounding from October slowdown

WASHINGTON (AP) The U.S. labor market rebounded in November, adding 227,000 workers in a strong recovery from the previous month, when the effects of strikes and hurricanes sharply reduced employers' payrolls.

Last month's hiring growth was up significantly from October's meager gain of 36,000 jobs. The government also revised upward its estimate of job growth in September and October by a total of 56,000.

The Labor Department report released Friday showed the unemployment rate fell from 4.1% in October to a still-low 4.2%. Hourly wages rose 0.4% from October to November and 4% from a year earlier, both strong numbers and slightly higher than forecasters expected.

The November jobs report provided the latest evidence that the U.S. labor market remains durable, even though it has lost significant momentum compared to the 2021-2023 hiring boom, when the economy was rebounding after the pandemic recession. The gradual slowdown in the job market is partly due to the high interest rates implemented by the Federal Reserve in its desire to control inflation.

The Fed raised interest rates 11 times in 2022 and 2023. Defying predictions, the economy continued to grow despite much higher borrowing rates for consumers and businesses. But since the start of the year, the job market has slowed down.

Thomas Simons, U.S. economist at Jefferies, wrote in a commentary that the recovery from October's strikes and hurricanes likely increased last month's payrolls by 60,000, suggesting the labor market is sufficiently strong to absorb most job seekers, but not enough to cause concerns about inflation.

The healthy gain of 227,000 payroll jobs in November comes from a Department of Labor survey of employers. A separate household survey, which determines the unemployment rate, appears lower: The number of unemployed rose by 161,000. And the number of Americans saying they have a job or are looking for one fell for the second month in a row.

Economists also noted that employment gains in November were limited: just three categories of employers in health care and social assistance; leisure and hospitality; and the government accounted for 70% of the jobs created. And the 22,000 factory jobs added in November were bolstered by the end of strikes at Boeing and elsewhere, which allowed many workers to return to their employers. On the other hand, retailers cut 28,000 jobs.

I don't think we should be misled by the massive 227,000 number, said Julia Pollak, chief economist at job firm ZipRecruiter.

Pollak noted that October and November job gains averaged a modest 132,000 per month.

This report offers very little evidence of a rebound in the labor market, she said.

Yet Americans as a whole enjoy unusual job security. This week the government announced that layoffs fell to just 1.6 million in October, below the lowest levels in the two decades before the pandemic. At the same time, the number of job openings has rebounded from its lowest level in three and a half years, a sign that companies are still looking for workers even as hiring has slowed.

The overall economy remained resilient. Much higher borrowing costs for consumers and businesses resulting from the Fed's rate hikes were expected to tip the economy into a recession. Instead, the economy continued to grow as households continued to spend and employers continued to hire.

The economy grew 2.8% annually between July and September thanks to healthy consumer spending. Annual economic growth has exceeded a decent 2% rate in eight of the last nine quarters. And inflation fell from a peak of 9.1% in June 2022 to 2.6% last month. Despite this, Americans have been deeply frustrated by continued high prices under the Biden-Harris administration and, in part for this reason, chose last month to return Donald Trump to the White House.

While relatively few Americans lose their jobs, those who do have a harder time landing a new one: the average unemployed American last month had been out of work for 23.7 weeks, the longest such period for 2 and a half years.

Progress against inflation and slowing hiring, which eases pressure on businesses to raise wages and prices, led the Fed to cut its key rate in September and again last month. A further rate cut is expected to be announced at the Fed meeting on December 17-18.

Pollak of ZipRecruiter said she sees reason to be optimistic about the job market. For example, wage gains have exceeded inflation for two years, thus strengthening the purchasing power of Americans. And lower borrowing rates are likely to encourage spending and hiring in the future.

There are all kinds of growing tailwinds that should propel this job market forward, she said.

But for now, some companies are being cautious. Chris Butler, CEO of the National Tree Company, which makes artificial Christmas trees, wreaths and garlands, said he is taking a cautious approach to hiring. The company is struggling with subdued spending, and like its competitors, National Tree has sharply cut back on purchases as many shoppers have forgone discretionary purchases. Butler also is monitoring the prospect of high new tariffs that President-elect Donald Trump said he would impose on imports from China and other countries.

Although National Tree Company sources a significant portion of its business from China, it shifts more production to Vietnam and Cambodia. He plans to leave China completely in 2026, as he prepares for Trump to take office.

For 2025, Butler said, some roles will likely need to be added. But it certainly won't be a hiring boon.

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DInnocenzio reported from New York.

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