The U.S. Economy Added 199,000 Jobs in November, Unemployment Fell to 3.7%

A man pushes his way through a winter snowstorm in Atlantic City, N.J., Thursday, Jan. 4,
AP/Matt Rourke

Employers in the United States added 199,000 workers to their payrolls in November, the Department of Labor said Friday.

The unemployment rate fell to 3.7 percent from 3.9 percent.

Economists had expected the economy to add 185,000 after payrolls were reported as increasing by 150,0000 in October. That figure was unrevised in this month’s report. In September, employers grew their payrolls by a downwardly revised 262,000. In August, payrolls rose by 227,000.

The unemployment rate was expected to hold steady at 3.9 percent.

The slowdown in hiring has bolstered market expectations that the Fed is done raising rates and will begin cutting in the first half of next year. The Fed decided at its meetings in November and in September to hold rates steady to see how earlier rate increases are affecting the economy. It is universally expected to hold rates steady at its meeting next week

The Federal Reserve has been trying to cool off demand for labor, fearing that higher wages could put upward pressure on inflation. In recent months, those efforts have appeared to pay off as job openings have fallen and payroll growth slowed.

Inflation has fallen sharply, although it remains significantly above the Fed’s two percent target. In October, the latest figures available, the consumer price index was up 3.2 percent over the previous twelve months. The index was flat with September, held down by a sharp decline in energy prices. Core prices, which exclude food and energy, were up four percent annually and 0.2 percent compared with the previous month.

The private sector added 150,000 in November, hitting the forecast of Wall Street economists. The prior month’s growth was revised down from 99,000 to 85,000.

Local and state government’s expanded their payrolls by 49,000, while the federal government’s employment level was flat. Over the past 12 months, the average monthly gain in government employment has been 55,000.

The UAW strike was largely responsible for a fall in payrolls in manufacturing in October, when employment in U.S. factories fell by 35,000. Most of those jobs were added back in November, as payrolls grew by 28,000. Economists had forecast a return of all 35,000 jobs. Thirty thousand jobs were added by automakers and parts suppliers while other sectors shed some jobs.

The jobs figures are subject to large and frequent revision. September’s jobs growth was originally reported at 336,000, more than twice the expected 160,000. This was revised down to 297,000 last month and revised again to 262,000. The October figure was unrevised.


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