HIRING PULLBACK A CAUSE FOR CONCERN.
Hiring pullback could signal mild slowdown in growth
WASHINGTON — U.S. job growth declined modestly in November, a move that could signal a slower but still steady pace of hiring and growth next year.
The potential for a more anemic economy contributed to a sharp drop in the stock market Friday, sending the Dow Jones average down 560 points, or 2.2%, by market close.
Yet most economists said last month’s job gain of 155,000 is more sustainable than some of the larger increases posted earlier this year. And hiring at last month’s pace would make it easier for the Federal Reserve to slow its interest rate increases, which investors worry are weighing on the economy.
“This is the new Goldilocks,” said Josh Wright, chief economist at ICIMS, a recruiting software company. “Still strong-enough job growth, but a more cautious Fed.”
The unemployment rate stayed at 3.7 percent, a nearly five-decade low, for the third straight month, the Labor Department said Friday in its monthly jobs report.
Still, the panicky financial markets illustrate how the views of Wall Street and most of the rest of the U.S. can differ.
For most Americans, jobs and incomes are the most important economic measures. Average hourly earnings increased 3.1 percent in November from a year earlier, Friday’s report said, only the second time they have climbed that much since the recession
ended nine years ago.
That’s boosting consumer confidence to nearly 18-year highs, spurring more spending, and bolstering winter holiday shopping. Americans lifted their spending in October by the most in seven months.
Yet for Wall Street, higher pay can crimp corporate profit margins. Many large, publicly traded companies are hit by slower growth in places such as Europe and Japan. They are also more directly affected by tariffs that the Trump administration has imposed on a range of imports.
People attend a job fair in Chicago in June. U.S. employers added 155,000 jobs in November, down from a more robust 237,000 in October. Below: A job applicant attends a job fair in Miami Lakes, Fla., in January.
the previous month’s figure, which was the best since 2009.