U.S. Added 266,000 Jobs in November; Unemployment at 3.5%

U.S. Added 266,000 Jobs in November; Unemployment at 3.5%
By: WNG NYT Posted On: December 06, 2019 View: 45

U.S. Added 266,000 Jobs in November; Unemployment at 3.5%

■ 266,000 jobs were added in November. Analysts had expected a gain of about 180,000, according to MarketWatch.

■ The unemployment rate was 3.5 percent, down from the previous month.

■ Average hourly earnings rose 0.2 percent, with a year-over-year gain of 3.1 percent.

The return of tens of thousands of striking workers to their jobs at General Motors helped supercharge hiring totals last month.

The reassuring jobs report, released Friday morning by the Labor Department, offered a counterpoint to renewed anxieties about an escalating trade war and a weakening global economy.

President Trump stoked trade tensions this week by imposing new tariffs on steel and aluminum from Brazil and Argentina; suggesting that the feud with China could continue for another year; and threatening European allies with import taxes.

The White House’s unpredictable trade policy has unsettled businesses and cramped investment. They have also helped heighten concerns about a faltering manufacturing sector.

Still, the American economy has a firm footing as consumers spend and employers hire.

“We still see pretty healthy underlying labor market conditions,” said Robert Rosener, an economist at Morgan Stanley. The number of people applying for unemployment benefits remains at historically low levels, and Americans continue to show a willingness to quit their jobs. “That tells you that consumers are still pretty confident of labor market conditions,” he said

Among businesses, worries about the economy seemed to peak this summer. Since then, there have been signs that the slowdown was slowing, said Joe Galvin, chief research officer of Vistage, an association of small-business owners and executives.

Roughly 60 percent of the 654 employers surveyed in November by Vistage said they planned to expand head count next year. Just 4 percent are planning cuts.

Since employment gains can bounce unpredictably from month to month, what matters is the underlying trend. So far this year, average monthly payroll gains have buzzed around 170,000. That is less than the average for last year, when tax cuts and government spending helped juice the economy, but it is still hefty considering that the expansion is in its 11th year.

In a newsletter this week, David Kelly, chief global strategist at JPMorgan Funds, compared recent hiring to squeezing one more glob of toothpaste out of a seemingly empty tube. “Over the last few years,” he said, “an apparently fully tapped-out labor market has yielded a surprising number of new workers.”

The buffet of available job postings has drawn many Americans back to work. Employers have widened their scope, recruiting people with disabilities or criminal records. Older baby boomers are working past retirement age and stay-at-home parents are switching to paid employment.

The labor force participation rate inched up through most of the spring and fall, driven in part by an increase in women 25 to 34 getting jobs or starting to look for work. Over the last year, nearly 1.7 million people joined the ranks of workers.

Mr. Kelly does not expect the historically low unemployment rates to fall much more. “Gains in employment going forward will have to come from an increase in the labor force,” he wrote.

Economists are engaged in a vigorous debate about how tight the labor market is and how many more people are available to work. Mr. Trump’s more restrictive immigration policies has significantly shrunk the supply of foreigners who could come to work in the United States.

Employment agencies say they are often unable to find candidates to fill the jobs that are open. “At every level of employment, it’s been super tight,” said Yvonne Rockwell, owner of an Express Employment Professionals agency in Santa Clarita, Calif. “I truly believe that anybody who wants to work is working.”

Southern California has a lot of aerospace companies, and Ms. Rockwell focuses on skilled trades and higher-level positions. “This is our best year ever,” said Ms. Rockwell, who opened her franchise five years ago.

The competition for workers has helped push up wages, particularly at the lower end of the scale.

And Amazon’s decision last year to raise its minimum wage to $15 across the country has turned up the pressure in some places.

“Everyone is struggling now to keep up with Amazon,” said John Dickey, who owns two Express Employment agencies in Massachusetts.

One company he works with, a light manufacturer in the chemical and food industry, is looking to hire 30 people for jobs that pay $14-to-$15 an hour. “This company does drug tests and background tests, and it requires 12 hours on your feet,” he said. “And you need to be able to speak and communicate in English.”

While employers routinely complain about their inability to find reliable workers, Mr. Dickey acknowledged that many of the available jobs can be less than desirable.

“These can be pretty rough working conditions,” he said, pointing to the food industry, where people can spend a lot of time in refrigerated warehouses or near industrial ovens. “It’s cold, it’s hot, it’s wet, the floors are slippery, so there tends to be a fair amount of turnover,” he said.

The clamor for more workers may make it easier for people who want to turn temporary holiday jobs into permanent ones. Historically, about 4 percent to 7 percent of seasonal workers are hired, said Amy Glaser, senior vice president of the staffing firm Adecco. This year, she expects that 20 percent could be retained after the new year.

Despite the low unemployment rate, stable, secure jobs that pay a middle-income wage can be hard to find across a range of skills.

Alan Kirshner worked as a budget analyst at Bristol Myers Squibb in New Jersey for 18 years before a restructuring eliminated his job in 2015.

“My goal was to find something more permanent like I had in the past,” he said, “but those opportunities were much more limited.” Companies have used technology to reduce staffing, shifted full-time workers to contracts and often moved the better-paying jobs out of the country or to lower-cost areas in the United States.

Mr. Kirschner is now a career coach — a business that he controls, but that offers no steady income or benefits.

Researchers have often documented bias against workers over 50 and minorities, especially African-American women.

The job market can differ radically from one place to another, with a 1.6 percent jobless rate in Fargo, N.D., 4.2 percent in Binghamton, N.Y., and 6.1 percent in Bakersfield, Calif.

Large urban centers tend to gulp much of the gains, said Julia Pollak, a labor economist at the online employment company ZipRecruiter.

Holiday hiring plunged among traditional retailers, according to ZipRecruiter’s listings, with rural and suburban areas hit particularly hard. And a much larger share of temporary holiday job postings are in e-commerce compared to in stores, she said.

The manufacturing picture is more mixed. Overall, job postings have increased, Ms. Pollak said, but they differ radically by type. Listings related to computer manufacturing are strong, for example, but demand for automotive workers has been weak.

The industry’s health has been somewhat clouded by the 40-day G.M. strike this fall and disruption in the aerospace industry stemming from the crash of two Boeing airplanes. And manufacturing activity measures have provided conflicting signals.

“When you look globally, there are some tentative signs that the global manufacturing slowdown is bottoming out,” Michael Gapen, chief United States economist for Barclays, said. “But it may take the U.S. manufacturing sector a little longer than the rest of the world to stabilize.”

“We still don’t have a Phase 1 agreement,” he said, referring to the promised first edition of a comprehensive trade accord with China. “And private sector spending in the U.S. is moderate at best.”

A trade agreement with China would, of course, be welcome, but Mr. Gapen said that at this point, he doesn’t expect that it will help lift growth. “It’s more of a going back to the beginning,” he said, noting that in the end, China is likely to commit to agricultural purchases that it might have made earlier without tariffs.

The government will revise its November estimates two more times, and its October estimate once more.

“We have seen some moderation in jobs gains, which you would expect,” said Rubeela Farooqi, chief United States economist at High Frequency Economics. But the average monthly increases to date, the low jobless rate and the growing share of adults joining the work force all point to a strong foundation, she said. “I think the labor market overall is looking pretty healthy.”

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