Biden plays up low unemployment rate as US jobs growth slows sharply in November
▶ Employers filled about 210,000 new positions, well below an earlier forecast of half a million
Job growth in the US slowed in November, posting the smallest increase this year and underscoring the struggle employers face in finding workers to fill millions of vacancies as the Covid-19 pandemic continues.
The US economy added about 210,000 jobs last month, well short of the roughly half a million gain that was forecast, data from the US Labour Department showed.
The unemployment rate fell to 4.2 per cent while the labour force participation rate edged up to 61.8 per cent.
In remarks on Friday, US President Joe Biden largely ignored the missed projections and shifted focus on the unemployment drop.
“At this point in the year, we are looking at the sharpest oneyear decline in unemployment ever,” Mr Biden said.
Overall, the November jobs figures point to an economic recovery that looks resilient, although under threat from a sharp increase in inflation and the potential impact of the Omicron variant of the coronavirus.
“This year, we can reflect on an extraordinary bit of progress. Our economy is markedly stronger than it was a year ago,” Mr Biden said.
“Because of the extraordinary strides we have made, we can look forward to a brighter, happier new year ahead.”
The data was collected before the emergence of the Omicron variant in the US.
Little is definitively known about the new strain but widespread business shutdowns are not expected. Still, it could discourage some Americans from travelling, shopping and eating out in the coming months and potentially slow the economy.
Mr Biden also announced a series of new measures in response to the Omicron strain, including a push to ensure free and easy access to vaccines and booster shots.
He has also pushed to ease inflation and the supply chain bottleneck that has caused anxiety among US shoppers heading into the holiday season.
“You need to see it and feel it in your own lives around the kitchen table and your cheque books. And that is why every day my team and I are working to deliver consistent determined focused action to overcome the challenges we still face,” Mr Biden said.
For now, Americans are spending freely and the economy is forecast to expand by 7 per cent a year in the final three months of 2021, a big rebound from the 2.1 per cent pace in the previous quarter, when the Delta variant hobbled growth.
The jobs report is composed of two surveys – one of employers and the other of households. The employer survey showed hiring slowed across industries, including declines at car makers and retail outlets. The household survey showed robust job growth and people coming off the sidelines.
While the headline number disappointed, the drop in the unemployment rate and the rise in labour force participation could help keep the US Federal Reserve on track to possibly tighten policy faster than planned as inflation proves more persistent than previously thought.
Fed chairman Jerome Powell told US senators this week that he is “not at all sure” if inflation will ease next year.
The central bank’s dual mandate requires that it weighs both price stability and maximum employment, and some policymakers fear that cutting off monetary support too soon could hurt the pace of jobs recovery.