U.S. hir­ing slower but steady as em­ploy­ers add 155K jobs

Windsor Star - - FINANCIAL POST - CHRISTO­PHER RUGABER

U.S. busi­nesses WASH­ING­TON added a smaller but still­healthy num­ber of jobs last month, while the un­em­ploy­ment rate re­mained at a fivedecade low and wages rose at a solid clip. The fig­ures, re­leased Fri­day by the La­bor Depart­ment, point to an econ­omy that is still adding jobs at a steady rate af­ter nearly 10 years of re­cov­ery. So far, em­ploy­ers are mostly shrug­ging off the fi­nan­cial mar­ket tur­moil of the past two months and ris­ing trade ten­sions be­tween the U.S. and China. U.S. em­ploy­ers added 155,000 jobs in Novem­ber, down from a more ro­bust 237,000 in Oc­to­ber. The un­em­ploy­ment rate re­mained 3.7 per cent, nearly a five-decade low, for the third straight month. Av­er­age hourly pay rose 3.1 per cent from a year ago, match­ing the pre­vi­ous month’s fig­ure, which was the best since 2009.

The econ­omy is ex­pand­ing ro­bustly, with growth reach­ing 3.9 per cent at an an­nual rate over the sum­mer and fall, the best six-month pace in four years. Still, on­go­ing in­ter­est rate hikes by the Fed­eral Re­serve, the Trump ad­min­is­tra­tion’s threats of higher tar­iffs on China, and weak­en­ing global growth have roiled fi­nan­cial mar­kets and raised fears about the U.S. econ­omy’s fu­ture. In­vestors ini­tially bid up stocks af­ter the re­port’s re­lease, but fi­nan­cial mar­kets fell in mid-day trad­ing. The Dow Jones dropped 375 points, or 1.5 per cent. That fol­lowed a small de­cline Thurs­day and an 800-point drop Tues­day. Novem­ber’s jobs fig­ure could por­tend a slower ex­pan­sion next year, economists said, as the stim­u­lus from last year’s tax cuts wears off and higher bor­row­ing costs weigh on home sales and busi­ness in­vest­ment. But most an­a­lysts an­tic­i­pate the econ­omy will still grow. “The econ­omy con­tin­ues to churn out new jobs and re­flects the strong un­der­ly­ing busi­ness con­di­tions that point to steady, al­beit slower job growth and eco­nomic ac­tiv­ity in 2019,” said Joe Brusue­las, chief economist at con­sult­ing firm RSM. “This re­port strongly im­plies that a re­ces­sion is not loom­ing just over the hori­zon.”

The re­port is un­likely to dis­suade the Fed­eral Re­serve from raising short-term in­ter­est rates at its meet­ing later this month, as ex­pected, Brusue­las said. But it sug­gests the Fed may not hike rates next year as rapidly as many in­vestors have feared.

The on­go­ing job gains are push­ing down un­em­ploy­ment rates to his­tor­i­cally low lev­els. The un­em­ploy­ment rate for men aged 20 and above fell last month to 3.3 per cent, the low­est in 18 years. And the rate for Amer­i­cans with just high school diplo­mas dropped to 3.5 per cent, the low­est since De­cem­ber 2000. The AfricanAmer­i­can job­less rate de­clined to 5.9 per cent, match­ing May’s fig­ure as the low­est on record. It’s also be­come more chal­leng­ing for busi­nesses to find work­ers. Em­ploy­ers have posted seven mil­lion open jobs, out­num­ber­ing the ranks of the un­em­ployed, which fell last month to just un­der six mil­lion. Hir­ing in Novem­ber was led by health-care firms, which added 40,100 jobs, and pro­fes­sional ser­vices such as ac­count­ing and en­gi­neer­ing, which gained 32,000. Man­u­fac­tur­ing firms hired 27,000 new staff, the most in seven months and a sign that trade ten­sions have yet to weaken fac­tory hir­ing.

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