U.S. hiring surged in November, as the economy added 266,000 jobs and unemployment returned to a half-century low, a sign the U.S. is powering through a global slowdown.
The payroll number easily topped the estimate of 180,000 from economists surveyed by Refinitiv, who also saw the unemployment rate holding steady from October’s 3.6 percent. It marks the 110th month of straight gains.
Unemployment ticked down slightly to 3.5 percent as more people were looking for work, matching a 50-year low. The labor force participation rate was little changed at 63.2 percent. Average hourly earnings, meanwhile, rose by 3.1 percent over the past year to $28.29.
Revisions, meanwhile, added 41,000 jobs for the prior two months, bringing the three-month average to 205,000, a 10-month high. (September increased by 13,000 to 193,000, and October jumped by 28,000 to 156,000). Still, job growth on average is slower than it was in 2018: The 2019 monthly average is 180,000 jobs per month, compared with an average gain of 223,000 last year.
“This is a blowout number and the U.S. economy continues to be all about the jobs,” said Tony Bedikian, head of global markets for Citizens Bank.
One reason for the rebound is the conclusion of the General Motors strike at the end of October. The motor vehicles and parts sector boosted employment with 41,300 workers in November, adding to the 54,000 jobs created in manufacturing last month. In October, when the economy added a better-than-expected 156,000 jobs, the motor vehicles and parts manufacturing sector posted a decline of 42,000 workers.
The blockbuster report provides further evidence that the longest economic expansion on record will continue and reinforces the Federal Reserve’s characterization of the labor market as “strong.” It also affirms the central bank’s decision to press pause on further interest rate cuts this year. Economists widely expect policymakers to leave interest rates unchanged at their two-day meeting next week.
Other sectors that contributed to the stellar report included leisure and hospitality, which increased by 45,000, and professional and business services, which rose by 38,000. One concerning sign in the report is that retail added 2,000 jobs, even in the midst of the vital holiday shopping season.
“This strength is leading the market to conclude that the Fed might not lower interest rates any further in 2020, and (interestingly) the futures market is even pointing to the slightest possibility of a rate increase as the year progresses,” said Scott Clemons, chief investment strategist at Brown Brothers Harriman.