263,000 jobs added despite crunch
U.S. labor market stays robust amid tech industry slow-up
The U.S. labor market grew again in November, with employers adding 263,000 jobs, a surprisingly robust pace amid a slowdown in the tech industry.
Unemployment in the United States remained unchanged from 3.7% a month earlier, according to data released Friday by the Bureau of Labor Statistics.
The still-strong labor market continues to be one of the sturdiest pillars of an otherwise confounding economy. Americans are spending heavily, with credit purchases and wages up amid a downturn in savings and persistent, decades-high inflation.
Manufacturing activity, meanwhile, contracted in November for the first time in more than two years. And although inflation is slowing — to 6% annually in October, according to a key U.S. index — the price increases remain well over the Federal Reserve’s 2% target.
Friday at the White House, after signing an emergency bill to avoid a national rail strike, President Joe Biden pointed to the added jobs and low unemployment as proof his policies have helped bulked up the economy.
“Things are moving — they’re moving in the right direction,” Biden said. “As we go into the holiday season, here’s what this all means:
The Americans are working, the economy is growing.”
Fed policymakers, however, want to see the economy cool. And the Friday jobs data reflects an incredibly resilient labor market as central bankers aggressively raises interest rates in hopes of stifling demand enough to contain inflation.
Meeting next in mid-December, Fed policymakers are hoping to chip away at the number of new hires and job openings without setting off a rise in unemployment — and at least for now, economists say, that appears possible.
“We’re obviously in a moment of tremendous risk in the economy right now,” said Adam Ozimek, chief economist at Economic Innovation Group, a nonpartisan business organization. “You can’t rule out a recession, but the economy seems to be rebalancing toward sustainable growth.”
The Fed remains concerned, however, that the persistently hot labor market will lead to wages rising further, and then ultimately worsening inflation. Wage growth has ticked down in recent months but remains well above historical norms.
Fed Chair Jerome Powell stressed this week that as long as inflation remains too high, Americans’ wage increases will not translate to a higher standard of living.
“Right now people’s wages are being eaten up by inflation,” Powell said Wednesday at an event at the Brookings Institution. “But if you want to have a sustainable, strong labor market, where real wages are going up right across the wage spectrum, especially for people at the lower end, you’ve got to have price stability. And until we restore that, we can’t get back to that place.”
A separate U.S. government report earlier this week showed that there were 10.3 million job openings in October, down from 10.7 million a month earlier.
Many of the declines were concentrated in state and local government, and manufacturing.
“There is a disconnect between workers and jobs,” said Giacomo Santangelo, economist at Monster.com. “You can say there are openings for every unemployed person, but that doesn’t match up to reality. There’s huge demand in nursing, but if you lost your job at Twitter or Meta or Alphabet, you’re not going to be a nurse.”
The divide is becoming increasingly clear as some companies have announced sweeping layoffs, while many others struggle to find enough workers. Some of the country’s largest employers, including Walmart, Amazon and Google, have recently cut thousands of white-collar jobs.
Tech firms have weathered a particularly sharp slowdown with heavy job losses and hiring freezes, and media companies including CNN and Gannett newspapers announced layoffs this week.
Meanwhile, employers in low-paying sectors such as education, health care and hospitality report widespread labor shortages.
Editor’s note: Amazon founder Jeff Bezos owns The Washington Post. Information for this article was contributed by Josh Boak and Aamer Madhani of The Associated Press.