US em­ploy­ers add solid 178K jobs in Novem­ber

Un­em­ploy­ment sinks to 4.6%

Kuwait Times - - BUSINESS -

US em­ploy­ers added a solid 178,000 jobs in Novem­ber, re­flect­ing the steady econ­omy Pres­i­dent-elect Don­ald Trump will in­herit. And the un­em­ploy­ment rate hit a nine-year low of 4.6 per­cent, though mainly be­cause many peo­ple stopped look­ing for jobs and were no longer counted as un­em­ployed. Av­er­age hourly pay slipped af­ter a solid gain the pre­vi­ous month. Pay has in­creased at only a mod­est pace in the past year.

The re­port’s mixed sig­nals il­lus­trate the chal­lenges fac­ing Trump: Steady job gains and a low un­em­ploy­ment rate sug­gest that the econ­omy is healthy. But weak pay in­creases and fewer Amer­i­cans work­ing or look­ing for work point to longer-term chal­lenges.

Fewer than 60 per­cent of adults have jobs - 3 per­cent­age points lower than when the Great Re­ces­sion be­gan in late 2007. In part, that trend re­flects retirements by the na­tion’s many baby boomers. But it also means hir­ing hasn’t kept up with pop­u­la­tion growth.

Seven years into the re­cov­ery, pay growth is still be­low healthy lev­els. And the num­ber of part-time work­ers who would like full-time jobs is 28 per­cent higher than be­fore the re­ces­sion.

Many of these trends - par­tic­u­larly the drop in the pro­por­tion of adults with jobs - emerged years be­fore Obama took of­fice. Trump’s chal­lenge will be to try to re­verse them. He may get some help from the econ­omy’s up­swing: As em­ploy­ers con­tinue hir­ing amid low un­em­ploy­ment, they will likely be forced to of­fer higher pay. Thicker pay­checks, in turn, may draw more peo­ple who aren’t ei­ther work­ing or seek­ing a job to be­gin look­ing again. And busi­nesses may of­fer more hours to their part-time work­ers.

There is ev­i­dence - such as last month’s solid wage gain - that these trends have be­gun to take hold, though progress has been slow. Still, nearly ev­ery eco­nomic re­port since the elec­tion has pointed to ac­cel­er­at­ing growth - key rea­son why the Fed­eral Re­serve is con­sid­ered cer­tain to raise short-term in­ter­est rates at its next meet­ing later this month. Amer­i­cans bought homes in Oc­to­ber at the fastest pace in nearly a decade. Their will­ing­ness to make such a ma­jor pur­chase re­flects grow­ing op­ti­mism. In fact, ac­cord­ing to the Con­fer­ence Board, Amer­i­cans are more con­fi­dent in the econ­omy than at any other point in the past nine years.

They are spend­ing more, too. Solid con­sumer spend­ing helped pro­pel growth to a 3.2 per­cent an­nual rate in the July-Septem­ber quar­ter, the best show­ing in two years. By one mea­sure, na­tion­wide home prices have fully re­cov­ered and are even slightly above the level they reached in 2006, be­fore the hous­ing bub­ble burst.

That steady rise in home prices has boosted Amer­i­cans’ house­hold wealth and helped lift their over­all fi­nances. And even as con­sumers are spend­ing more, pay is ris­ing enough to en­able more sav­ings: Amer­i­cans saved 6 per­cent of their af­ter-tax in­come in Oc­to­ber, up from 5.7 per­cent in Septem­ber. —AP

In this Wed­nes­day Nov 2, 2016, file photo, job seek­ers at­tend a New York Depart­ment of City­wide Ad­min­is­tra­tive Ser­vices job fair, in New York. — AP

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