U.S. hir­ing slower but steady

Em­ploy­ers add 155K jobs

Greenwich Time - - BUSINESS -

U.S. busi­nesses added a smaller but still-healthy num­ber of jobs last month, while the un­em­ploy­ment rate re­mained at a five-decade 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 per­cent, nearly a fivedecade low, for the third straight month. Av­er­age hourly pay rose 3.1 per­cent 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 per­cent 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 per­cent. 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 for a va­ri­ety of groups. The un­em­ploy­ment rate for men aged 20 and above fell last month to 3.3 per­cent, the low­est in 18 years. And the rate for Amer­i­cans with just high school diplo­mas dropped to 3.5 per­cent, the low­est since De­cem­ber 2000. The African-Amer­i­can job­less rate de­clined to 5.9 per­cent, match­ing May’s fig­ure as the low­est on record.

It’s also be­come more chal­leng­ing for busi­nesses to find the work­ers they need. Em­ploy­ers have posted 7 mil­lion open jobs, out­num­ber­ing the ranks of the un­em­ployed, which fell last month to just un­der 6 mil­lion.

Michael Mabry, chief op­er­at­ing of­fi­cer at Mooyah, a fast-causal burger chain mostly lo­cated the south, says his com­pany has had to raise pay and of­fer more flex­i­ble sched­ul­ing to at­tract new work­ers. The com­pany plans to open 15 lo­ca­tions next year, which could cre­ate up to 450 new jobs.

Ap­pli­ca­tions have fallen “to an all-time low,” Mabry said. The com­pany fo­cuses most of its ef­forts on re­cruit­ing em­ploy­ees from other res­tau­rants, in­clud­ing those that might work later hours at places that serve al­co­hol. His res­tau­rants close at 10 p.m.

“We’ve had to get com­pet­i­tive on work-life bal­ance,” Mabry said. Nearly all em­ploy­ees make at least $10 an hour, and man­age­ment salaries have risen 5 to 10 per­cent in the past year, he added.

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 com­pa­nies hired 27,000 new work­ers, the most in seven months and a sign that trade ten­sions have yet to weaken fac­tory hir­ing.

Ly­dia Bous­sour, se­nior econ­o­mist at Ox­ford Eco­nom­ics, said that con­tin­u­ous job gains and ris­ing pay has bol­stered con­sumer con­fi­dence, off­set­ting the im­pact of fall­ing stock prices. Greater con­fi­dence has boosted hol­i­day shop­ping.

Re­tail­ers re­sponded by ad­ding 18,200 po­si­tions in Novem­ber, the most in six months. On­line spend­ing has lifted ship­ping and ware­hous­ing jobs, which grew 25,400, the largest in 14 months.

Most re­cent data have pointed to an econ­omy in solid shape. Amer­i­cans in­creased their spend­ing in Oc­to­ber by the most in seven months, and their in­comes grew by the most in nine months, ac­cord­ing to a gov­ern­ment re­port last week. Con­sumer con­fi­dence re­mains near 18-year highs, sur­veys show. And both man­u­fac­tur­ing and ser­vices com­pa­nies ex­panded at a healthy pace in Novem­ber, ac­cord­ing to a pair of busi­ness sur­veys.

The hous­ing mar­ket, though, has stum­bled this year as the Fed’s rate hikes have con­trib­uted to sharply higher mort­gage rates. Sales of ex­ist­ing homes have fallen 5.4 per­cent from a year ear­lier, the big­gest an­nual de­cline in more than four years.

Lynne Sladky / As­so­ci­ated Press file photo

A job ap­pli­cant looks at job list­ings for the River­side Ho­tel at a job fair hosted by Job News South Flor­ida, in Sun­rise, Fla. The U.S. un­em­ploy­ment rate fell to 3.7 per­cent in Septem­ber 2018 the low­est level since De­cem­ber 1969 sig­nal­ing how the long­est streak of hir­ing on record has put mil­lions of Amer­i­cans back to work. Em­ploy­ers added just 134,000 jobs last month, the fewest in a year, the La­bor Depart­ment said Fri­day, Oct. 5. But that fig­ure was likely de­pressed by the im­pact of Hur­ri­cane Florence.

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