Nonfarm payrolls increased 211,000 last month, the Labor Department said on Friday.
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In fact, October’s job gains were revised up to 298,000 jobs added from 271,000 jobs. The Fed has a dual mandate: It must act to prevent the economy from overheating, but it must also do what it can to right a job market that, by some measures, has yet to fully recover from the 2008 recession.
“The employment report will give the Fed confidence to begin raising rates in December”.
Just as the bond market has priced in some of the Fed’s expected increases, consumers are doing the same, said Redfin Chief Economist Nela Richardson.
Chris Williamson, chief economist at Markit, says the jobs report shows that the economy “is strong enough to withstand an initial hike in interest rates”.
A Reuters survey of banks that deal directly with the Fed showed all but one of the so-called primary dealers expect the Fed will hike rates at the December 15-16 meeting. Their stepped-up spending has supported the US economy and offset drags from falling oil prices and weak growth overseas. As Sam Stovall, U.S. equity strategist for S&P Capital IQ put it: “Not only does Fed Chair Yellen look forward to the start of what she calls the normalization process, but so too do investors and journalists who are exhausted of this never-ending speculation”.
Average weekly earnings for manufacturing employees inched slightly higher, up from $1,036.22 in October to $1,037.04 in November.
The official job and wage figures continued to paint a rosy picture of the United States economy, with 211,000 net new jobs created last month – above analysts’ expectations. Some economists point to the lagging pay as evidence that the job market isn’t as healthy as the low unemployment rate would suggest. In November, average hourly wages were up 2.3 percent from a year earlier. Year over year they climbed 2.3%, down from a recent high of 2.5%. The average workweek, however, dipped to 34.5 hours from 34.6.
As you can see, GLD sold off as the market priced in a Fed rate hike and then launched when the rate hike didn’t materialize. The so-called dot plots that reflect Fed officials’ interest rate expectations show benchmark interest rates rising to a median projection of roughly 1.25 percent by the end of 2016 and at least 2.5 percent by 2017. Discouraged workers are persons who want a job but have given up looking for employment because they believe there is no work available for them. That reflected an increase in part-time workers.
Manufacturing has been crippled by a strong dollar, efforts by businesses to reduce bloated inventory and spending cuts by energy companies scaling back well drilling and exploration in response to sharply lower oil prices.
Government added 14,000 positions, and retail jobs grew almost 31,000. “Mining and information lost jobs”.
The report was in line with job growth typical of the past year.
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Construction payrolls increased 46,000 last month, the largest gain since January 2014. Jobs were added in construction, health care, and “professional and technical services”-the Labor Department’s term for an assortment of white-collar jobs”. “I now judge that USA economic growth is likely to be sufficient over the next year or two to result in further improvement in the labour market”, Yellen said, according to the text of testimony yesterday before Congress’s Joint Economic Committee.
