Another month of strong job gains would allay fears the economy had hit a soft patch, after reports showing tepid consumer spending in October and a slowdown in services industry growth in November.
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With the November report, the average monthly increase in jobs over the past 12 months is 237,000, and the number of officially unemployed people has fallen by 1.1 million.
Ms. Yellen noted that one reason not to delay a rate hike too much longer is to avoid the need for faster increases that could be more disruptive to the economy than the gradual rate path policymakers prefer.
“It was heartening to see growth in construction and that manufacturing held steady as… both are sensitive to higher interest rates”, said Tara Sinclair, chief economist at job search site Indeed.com.
The Dow surged by about 370 points Friday to close at 17,847.63 in the wake of the November jobs report after dropping more than 250 points on Thursday.
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. Some economists point to the lagging pay as evidence that the job market isn’t as healthy as the low unemployment rate would suggest.
With more jobs and long-awaited, if still modest pay increases, Americans are spending more on costly items like cars and homes.
In November, the average hourly wage was $25.25, an increase of 2.3 percent from a year ago. Officials argue the tightening labour market should be followed by higher wages and a return of inflation to the Fed’s 2 per cent target.
Just this week, Yellen also underlined that the economically neutral level for the fed funds rate may be low by historical standards, thanks partly to a lasting hangover from the financial crisis.
Yellen highlighted the potential turnaround in her speech Wednesday.
A Fed rate hike typically results in increases in interest rates on mortgages, auto loans and other borrowing, although those increases might not occur immediately.
The U.S. economy “is strong enough to withstand an initial hike in interest rates from what were seen as emergency record-low levels”, said Chris Williamson, chief economist at Markit. A hike would start to normalize monetary policy, closing the curtain on years of nontraditional measures, including the country’s first foray into quantitative easing. The unemployment rates for adult males was 4.7 percent; adult females, 4.6 percent; whites, 4.3 percent; African Americans, 9.4 percent; Asians, 3.9 percent; and Hispanics, 6.4 percent.
By many measures, the job market is almost back to normal. Tool and die makers, in particular, are in high demand, Mr. Keppler said.
Pockets of weakness still appear across the labor market. The dollar rose against a basket of currencies and USA stocks were trading higher. The average workweek per all USA employees remained unchanged at 34.5 hours. Manufacturing jobs, which are among the most exposed to the global economy, actually fell by 1,000 in November, the third drop in the last four months. It has lost 123,000 jobs since a recent peak in December 2014, 14% of its workforce.
Sectors focused on the domestic economy are far brighter.
Analysts had forecast that 190,000 new jobs would be created in November.
Work is lined up through next August as AES clients-including the University of Kentucky and Toyota Motor Corp.-continue expanding and making capital improvements. “In that sense, it is a day that I expect we all are looking forward to”. “The outlook for 2016 is very optimistic”.
Other domestically focused sectors also posted solid job growth.
Job gains were led by construction, where 46,000 positions were added, as well as professional and technical services, healthcare and restaurants and bars.
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“I wasn’t sure if I was going to be a wanted commodity”.
