The U.S. economy added 199,000 jobs in November, marking a decrease in the unemployment rate to 3.7%. This growth includes approximately 41,000 autoworkers and actors who returned to work following strikes. Despite a year and a half of interest rate increases, the economy remains far from recession territory. Wages saw a 0.4 percent increase over the month, exceeding expectations, and the workweek lengthened slightly.
However, job growth has narrowed in recent months, with sectors dependent on consumers buying physical goods declining and service industries accounting for most gains. Health care added 77,000 jobs and government added 49,000. On the other hand, the retail industry shed 38,000 jobs on a seasonally adjusted basis, reflecting what appears to be the weakest holiday hiring season since 2013.
The report also highlights a cooling job market, with businesses hiring at a slower pace and fewer worker shortages. Wages are growing at a slower but still-healthy pace, and inflation pressures have eased. The Federal Reserve is expected to keep its benchmark rate unchanged in its next meeting, with the possibility of rate cuts in the future.
This comes as the Federal Reserve aims to guide the economy to a 'soft landing' and manage inflation. Some investors hope that the central bank will start cutting rates next year. However, economists caution that the underlying pace of job growth has slowed in recent months. The U.S. economy is experiencing a gradual cooling of the labor market, with job growth slowing down in November. Employers added 199,000 jobs last month, marking the second consecutive month of job gains below the average for 2023. Overall, the economy is on track for a soft landing.
