Wall Street Journal – by JEFFREY SPARSHOTT And SARAH PORTLOCK
WASHINGTON—U.S. employers continued to add jobs at a steady pace and the unemployment rate fell in November, a sign of stronger economic growth that may intensify debate within the Federal Reserve about reducing central bank bond purchases as early as this month.
U.S. payrolls rose by 203,000 last month, the Labor Department said Friday. The unemployment rate dropped three-tenths of a percentage point to 7.0%, the lowest level in five years. Economists surveyed by Dow Jones Newswires had forecast nonfarm payrolls would rise by 180,000 and the unemployment rate would tick down to 7.2%. September and October payroll numbers were revised up by a combined 8,000.
Friday’s report may reinforce expectations that the Fed will soon slow the pace of its $85 billion a month in bond purchases. At their October meeting, officials were looking to end the program “in coming months.” The Fed’s program, started in September 2012, is designed to keep long-term interest rates low, boost investment and spur hiring.
Fed officials next meet Dec. 17-18.
“December is certainly a meeting where the issue can be addressed, but I want to be quite confident” the economic recovery is on track before cutting Fed bond buys, Federal Reserve Bank of Atlanta President Dennis Lockhart said Thursday.
Mr. Lockhart said a November jobs report that registered as strong as October’s could boost his confidence about the Fed cutting back.
Other economic indicators, though, have been mixed.
U.S. gross domestic product, the broadest measure of goods and services produced in the economy, rose at a healthy clip in the third quarter of the year, according to a separate report released Thursday. But the strong number was the result of a sharp buildup in business inventories, a factor that will likely lead to slower growth at the end of the year as businesses draw down stockpiles.
Other underlying figures suggest Americans remain cautious. Consumer spending in the third quarter advanced at the weakest pace since the recession ended. Business investment flatlined.
Fed officials forecast faster growth in 2014 as the impact of this year’s federal tax hikes and spending cuts fade.
Over the past six months, employers have added an average of 180,000 jobs a month, a little slower than the 183,000 pace for all of 2012.
“We’re not seeing a breakout. It’s more a sustained improvement in the labor market,” Stuart Hoffman, chief economist and PNC Financial Services, said ahead of Friday’s release.
Steady job growth has helped bring the unemployment rate down.
In November, the unemployment rate fell as the number of people finding work rose and government workers furloughed during the October government shutdown returned to work.
In some past months, the rate had fallen because of people dropping out of the labor force.
The rate has fallen steadily since September 2012, when the Fed launched its bond-buying program.
In June, Fed Chairman Ben Bernanke said he expected the unemployment rate to be about 7% when the central bank ended its signature bond-buying program, perhaps in mid-2014. He has since dismissed the informal 7% threshold and in September said there isn’t “any magic number that we are shooting for. We’re looking for overall improvement in the labor market.”
Private companies added 196,000 jobs in November, accounting for most of the month’s gains. Employment increased broadly, with gains for transportation and warehousing, health care, manufacturing, retail and construction.
Manufacturers added 27,000 jobs last month.
Federal government employment fell by 7,000 last month, but that was more than offset by increased hiring at the state and local level.
Friday’s report also said that average earnings rose by 4 cents to $24.15 an hour, while the average workweek increased 0.1 hour to 34.5 hours.
Higher wages and more hours mean additional money in consumers’ pockets.
—Michael S. Derby contributed to this article.
Write to Jeffrey Sparshott at jeffrey.sparshott@wsj.com and Sarah Portlock at sarah.portlock@wsj.com
http://online.wsj.com/news/articles/SB10001424052702303497804579241862778923036
I honestly have no sympathy for anyone stupid enough to believe any of the unemployment myths spewed out of the mouths of the main stream media. Honestly, with record numbers of people on food stamps and/or other forms of assistance, it doesn’t take a rocket scientist to figure out that the figures being touted are bold faced lies. The few left in this country that are working are mostly working part-time, low wage jobs which no one can survive on.
Unemployment only covers people within the program of unemployment – pending claims, receiving benefits or not.
Jobless if the number of people out of work and even that number does not count a lot of people.
Think about the jobs lost vs. the type of low paying jobs created.
Statistics usually work well for the presenter.
I completely agree Sunfire. All one needs to do is go over to ShadowStats and you will see the actual unemployment rate is approaching 25%.
Unbelievable. If that’s the case, how come I still can’t find a job? I guess it’s because I’m not an illegal immigrant.