![]() The government's latest report on October core personal consumption expenditures, or the Federal Reserve's preferred inflation gauge, showed an increase of 4.1% year-over-year – the most in three decades.Īnd key members of the Fed have signaled they are inclined to shift their focus to staving off inflation, even as the labor force participation and unemployment rates have yet to return to their pre-pandemic levels. Inflationary trends have also been reflected in other recent economic data. Average hourly wages rose by 4.8% in November over last year, matching October's annual rate but coming in slightly cooler than the 5.0% increase expected. Average hourly earnings rose for an eighth straight month, increasing by 0.3% in November compared to October. "On balance, robust labor demand and further COVID improvements should support strong labor market gains last month, though we are mindful of the challenges the are likely to persist in the labor market for the foreseeable future."Īs worker demand remains elevated, wages have also risen and contributed to the inflation seen across the economy this year. As such, labor market conditions should remain tight, perpetuating strong wage growth," Sam Bullard, managing director and senior economist for Wells Fargo, wrote in an email ahead of Friday's report. "Labor supply shortages do not show material signs of improvement, and could actually worsen in coming months with the federal vaccine mandate taking effect on January 4, 2022. To view this content, you'll need to update your privacy settings. ![]() With the latest emergence of the Omicron variant, these myriad factors may further inhibit a rebound in labor force participation. The labor force participation rate had been 63.3% in February 2020 before the pandemic meaningfully impacted the job market.Įconomists have attributed the stubbornly depressed participation rate to a host of factors, including lingering concerns about COVID-19 infections, difficulties finding child care and a desire by many workers to leave their jobs and pursue roles with more flexibility, wages or benefits. The labor force participation rate ticked up slightly more than anticipated in November, however, to reach 61.8%, versus the 61.7% consensus economists were expecting and the 61.6% posted in October. As of November, the civilian labor force was still down by about 2.4 million participants, compared to February 2020. Payrolls grew by 546,000 in October, versus the 531,000 previously reported, while jobs grew by 379,000 in September compared to the 312,000 posted in the first estimate.īut despite the solid rehiring throughout the year, labor force participation remains short of pre-pandemic levels. Though the payroll gain in the November jobs report disappointed sharply compared to expectations, job growth for October and September were each upwardly revised. "Moreover, we remain skeptical that a further significant recovery in the labor force lies ahead – particularly given the worsening virus situation and the potential Federal vaccine mandate," he added. economist for Capital Economics, wrote in a note on Friday. With new cases now on the rise again even before the potential impact of the Omicron variant, leisure sector employment growth looks set to remain weak over the winter," Andrew Hunter, senior U.S. "The headline miss was largely due to a muted 23,000 rise in leisure and hospitality payrolls, indicating that the nascent winter wave of virus infections was now weighing on the sector. In the goods producing sector, motor vehicle and parts employers also shed jobs, erasing more than 10,000 positions after adding 19,300 in October. Retail trade employers shed payrolls on net, with these dropping by more than 20,000 after job gains of nearly 40,000 in each of October and September. Leisure and hospitality industries, which had seen some of the biggest job gains in recent months, added just 23,000 payrolls after October's increase of 170,000. Service sector employment growth did decelerate notably in November compared to October, however. ![]() employers have added back jobs on net in every month so far in 2021 as vaccinations, reopenings and a recovery in the high-contact services industries helped boost hiring. ![]() 5.0% expected and a revised 4.8% in October 0.4% expected, 0.4% in OctoberĪverage hourly earnings, year-over-year: 4.8% vs. 4.5% expected, 4.6% in OctoberĪverage hourly earnings, month-over-month: 0.3% vs. +550,000 expected and a revised +546,000 in October Here were the main metrics from the print, compared to consensus estimates compiled by Bloomberg: The Labor Department released its November jobs report Friday at 8:30 a.m. economy added back fewer jobs than expected in November, while the unemployment rate fell further than anticipated to the lowest since February 2020.
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