Strong US job growth, rebound in wages bolster economy’s outlook
washington — US job growth increased at a strong clip in November and wages rebounded, painting a portrait of a healthy economy that analysts say does not require the kind of fiscal stimulus that President Donald Trump is proposing.
Non-farm payrolls rose by 228,000 jobs last month amid broad gains in hiring as the distortions from the recent hurricanes faded, Labour Department data showed on Friday. The government revised data for October to show the economy adding 244,000 jobs instead of the previously reported 261,000 positions.
Employment gains in October were boosted by the return to work of thousands of employees who had been temporarily dislocated by Hurricanes Harvey and Irma. November’s report was the first clean reading since the storms, which also impacted September’s employment data.
Average hourly earnings rose five cents or 0.2 per cent in November after dipping 0.1 per cent the prior month. That lifted the annual increase in wages to 2.5 per cent from 2.3 per cent in October. Workers also put in more hours last month. The average workweek rose to 34.5 hours from 34.4 hours in October.
The unemployment rate was unchanged at a 17-year low of 4.1 per cent amid a rise in the labour force. Economists polled by Reuters had forecast payrolls rising by 200,000 jobs last month.
“The labour market is in great shape. Tax cuts should be used when the economy needs tax cuts and it doesn’t need tax cuts right now,” said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.
“When politics and economics are mixed in the stew, the policies that are created often have a very awful smell,” Naroff said before the report was published.
Republicans argue that the proposed tax cut package will boost the economy and allow companies to hire more workers. But with the labour market near full employment and companies reporting difficulties finding qualified workers, most economists disagree. Job openings are near a record high.
The economy grew at a 3.3 per cent annualised rate in the third quarter, the fastest in three years. — Reuters