The U.S. added 263,000 jobs in November, and the unemployment rate remains at 3.7%, according to the latest Employment Situation Summary from the U.S. Bureau of Labor Statistics.
The analysis found that the amount of jobs added in November is roughly in line with
average growth over the prior three months (+282,000). Also, monthly job growth has averaged 392,000 so far in 2022, compared with 562,000 per month in 2021.
Additionally, the analysis found that notable job gains occurred in leisure and hospitality, health care, and government. Employment declined in retail trade and in transportation and warehousing.
Key findings:
- Leisure and hospitality added 88,000 jobs, including a gain of 62,000 in food services and drinking places. Employment in leisure and hospitality is below its pre-pandemic February 2020 level by 980,000, or 5.8%.
- Employment in health care rose by 45,000, with gains in ambulatory health care services (+23,000), hospitals (+11,000), and nursing and residential care facilities (+10,000).
- Government added 42,000 jobs, mostly in local government (+32,000). Since February 2020, government employment is down by 461,000, or 2%.
- Jobs in retail trade declined by 30,000. Job losses in general merchandise stores (-32,000), electronics and appliance stores (-4,000), and furniture and home furnishings stores (-3,000) were partially offset by a gain in motor vehicle and parts dealers (+10,000). Retail trade employment has fallen by 62,000 since August.
- Transportation and warehousing jobs declined by 15,000, and has decreased by 38,000 since July. Job losses in warehousing and storage (-13,000) and in couriers and messengers (-12,000) were partially offset by a gain in air transportation (+4,000).
- Average hourly earnings for all employees on private nonfarm payrolls rose by 18 cents, or 0.6%, to $32.82. Average hourly earnings of private-sector production and nonsupervisory employees rose by 19 cents, or 0.7%, to $28.10.
- Both the labor force participation rate, at 62.1%, and the employment-population ratio, at 59.9%, were little changed and have shown little net change since early this year. These measures are each 1.3 percentage points below their values in February 2020, prior to the COVID-19 pandemic.
Major takeaways:
MBA SVP and Chief Economist Mike Fratantoni commented:
“Job growth slowed, and the unemployment rate was unchanged in November. Despite this better-than-expected report, MBA is holding to its forecast of a recession in the U.S. in the first half of 2023. While the payroll survey showed a slower pace of growth, the household survey again showed an outright decline in employment–with a drop of 138,000 in November. With other data showing declines in job openings and increases in announced layoffs, we do expect further weakening ahead, with the unemployment rate likely to reach 5.5% by the end of 2023.
“Although wage growth picked up last month, it remains below the pace of inflation, meaning that households will increasingly have a difficult time managing these higher costs.
“A weakening job market will eventually be a negative for the housing market, as it will reduce demand. However, reaching the Federal Reserve’s goal of reducing inflation will be a benefit to those still in a position to buy a home, as it will bring down mortgage rates and improve affordability.”
Realtor.com Senior Economist George Ratiu commented:
“Economic growth continued on a positive path partway through the fourth quarter of this year, as payroll employment advanced in November to the tune of 263,000 net new jobs, outpacing market expectations. Employment gains were particularly notable in leisure and hospitality, health care, and government. Meanwhile, retail trade, as well as transportation and warehousing saw job cuts during the month.
“The headline unemployment rate remained unchanged at 3.7%, with the number of unemployed persons at 6.0 million. With one month to go before the year’s end, labor markets remain in a solid position. This week’s separate report on job openings highlighted that there were 10.3 million open positions in October, offering about 1.7 openings for each unemployed worker. Meanwhile, 4 million people quit their jobs during the month, looking for better employment.
“While the Federal Reserve considers this tight labor market concerning, as it keeps upward pressure on wages, growth in incomes is helping American families cope with rising prices and housing costs. Average hourly earnings for private employees reached $32.82 in October, a 5.1% yearly gain. With inflation seeing early signs of moderation, all eyes are on 2023 and the hope that the economy may achieve the Fed’s desired soft landing. Housing markets stand to see continued interest in transactions in the year ahead, albeit at a slower pace. With the number of employed workers and wages still rising, households are in a stronger position to weather higher home prices and interest rates. On a positive note, the inventory of homes for sale continues rising and the share of properties with price reductions grows, offering homebuyers more opportunities.”
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