Hiring slows in November
The number of jobs added back by the U.S. economy in November was the smallest hiring total since the pandemic struck.
Unemployment edged down to 6.7% in November employment rose by 245,000, the U.S. Bureau of Labor Statistics reported today. The unemployment rate stood at 6.9% in October and 7.9% in September.
Although the unemployment rate is down by 8 percentage points from its high in April, it remains 3.2 percentage points higher than it was in February.
Construction gained 27,000 jobs in November, but employment is 279,000 below its February level. In November, employment rose in residential specialty trade contractors (+14,000) and in heavy and civil engineering construction (+10,000).
In October, construction added 84,000 jobs.
“The housing market has been soaring despite the subdued job market due to the record low mortgage rates. However, the rates will not fall further, so the jobs recovery becomes even more important to sustain homebuying," said Lawrence Yun, chief economist of the National Association of Reatlors. "Jobs are also critical for commercial real estate."
Given the short housing supply, just a 3.3-month supply among new homes and 2.5-month supply in existing-homes, construction and home building is needed. The short addition of construction jobs in November could translate into supply dwindling even more while prices of homes continue to climb.
"The construction sector added only 27,000 new jobs in November – a bit light considering we need a greater supply of new homes," Yun said. "Therefore, the tight housing inventory situation is likely to be with us for a while.”
The retail trade took hit and lost 35,000 jobs last month, reflecting less seasonal hiring in several retail industries. Employment decreases occurred in general merchandise stores (-21,000); sporting goods, hobby, book, and music stores (-12,000); electronics and appliance stores (-11,000); and health and personal care stores (-8,000).
By contrast, furniture and home furnishings stores and automobile dealers added 6,000 jobs and 4,000 jobs, respectively. Employment in retail trade is 550,000 lower than in February.
Employment in transportation and warehousing rose by 145,000 in November but is 123,000 below its February level. In November, employment rose by 82,000 in couriers and messengers and by 37,000 in warehousing and storage; since February, employment in these industries has increased by 182,000 and 97,000, respectively. Job growth also occurred over the month in truck transportation (+13,000).
Overall manufacturing employment increased by 27,000 in November with job gains occurring in motor vehicles and parts (+15,000) and in plastics and rubber products (+5,000). Employment in manufacturing was 599,000 lower than in February.
"Job additions have to pick up significantly or it will take another three years to get us back to normal, not even accounting for all the new college graduates who will be searching for jobs during this time," Yun noted. "The decline in the unemployment rate to 6.7% should be discounted since the labor force participation rate declined."
"Fewer people looking for work is not a good sign."
The average hourly earnings for all employees on private nonfarm payrolls increased by 9 cents to $29.58 in November while the average hourly earnings of private-sector production and nonsupervisory employees increased by 7 cents to $24.87.
The average workweek for all employees on private nonfarm payrolls remained unchanged at 34.8 hours in November. In manufacturing, the workweek decreased by 0.2 hours to 40.3 hours, and overtime decreased by 0.1 hours to 3.1 hours.
The full Employment Situation report for November is available here.