The United States economy added 210,000 jobs last month, lower than what economists expected, according to the Labor Department’s jobs report on Friday.
Despite the disappointing jobs figures, unemployment fell sharply to 4.2% from 4.6% and average hourly earnings increased 0.3%, up 4.8% year-over-year.
A more encompassing measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons dropped even more, tumbling to 7.8% from 8.3%. The survey of households painted a more optimistic jobs picture, indicating an employment gain of 594,000 for the month.
Leisure and hospitality, which includes bars, restaurants, hotels and similar businesses, saw a gain of just 23,000 after being a leading job creator for much of the recovery. Though the sector has regained nearly 7 million of the jobs lost at the depths of the pandemic, it remains about 1.3 million below its February 2020 level, with an unemployment rate stuck at 7.5%.
Sectors showing the biggest gains in November included professional and business services (90,000), transportation and warehousing (50,000) and construction (31,000). Even with the holiday shopping season approaching, retail saw a decline of 20,000. Government added 10,000 jobs to the total.
"The relocations boost demand for a variety of other types of jobs, from construction of new homes to healthcare and retail. Those three metros, along with many others near the top of the ranking, have strong migration projections," said Jay Denton, chief labor market analyst at ThinkWhy. "Working-age population growth in these top ranked metros is projected to be two to three times stronger than the national average. They are creating new jobs at a faster pace than other larger metros and wages are benefitting from an overall tight supply of labor.”
With the emergence of the Omicron variant stoking fears of a halt in economic recovery, Friday’s report did little to alleviate those concerns.
“The disappointing 210,000 gain in non-farm payrolls in November suggests the labor market recovery was faltering even before the potential impact of the new Omicron variant, possibly as a result of the rising infection rates in the Northeast and Midwest,” wrote Andrew Hunter, senior U.S. economist at Capital Economics. “Nevertheless, the Fed will still push ahead with its plans to accelerate the pace of its QE taper at this month’s FOMC meeting.”
Despite those concerns, some experts noted that sharp decline in unemployment is a figure that could paint a more positive economic picture, as private employers continue to fill roles in a tight labor market.
“Don’t be fooled by the measly 210K payroll jobs gain this month because the economy’s engines are actually in overdrive as shown by the plunge in joblessness from 4.6% in October to 4.2% in November,” Chris Rupkey, chief economist for FWDBONDS, told yahoo! Finance. “Unemployment is tumbling as companies snap up workers to meet the economy’s very strong demand. The U.S. economy is back on a tear with full employment right around the corner. Fed rate hikes are coming.”