The U.S. economy added 211,000 jobs in November, a solid boost that likely means the Federal Reserve will raise interest rates later this month.
Advertisement
Only a awful job report would have been enough to prevent the Fed from raising rates in 12 days, Gad Levanon, managing director, economic outlook and labor markets at The Conference Board said in a statement.
Job growth in November was driven by strong gains in the construction industry, which expanded at its greatest pace in almost two years. The federal government reported Friday the economy added 271,000 jobs in October. October’s gain in temp jobs was revised upward to 28,100 from 24,500, the biggest month-over-month gain in a year.
Indeed, analysts expected that only an terrible employment report would have rocked the Federal Reserve’s boat ahead of a meeting later this month that will ultimately determine whether 2015 is the year for an interest rate liftoff.
The unemployment rate was unchanged at 5.0 per cent, the lowest level in seven years, as the economy continues to fend off the drag from the slowdown in the global economy.
Yet the continued sluggishness of wage gains, and the high numbers of part-time workers remain signs of persistent slack in the jobs market. But the Fed feels that rock-bottom interest rates – if allowed to linger for too long – could lead to risky behavior from investors and cause price bubbles. The college-level unemployment rate, which can serve as a proxy for professional employment, was also unchanged month over month at 2.5%.
The market was prepared for the report: USA stocks SPX, +1.25% surged, while yields on the 2-year Treasury edged higher. Over the past three months, the US has generated a healthy average of 218,000 jobs.
The economy “is doing well and that is the reason that it is a live option for us in our December meeting to discuss, as we indicated, whether or not it’s appropriate to raise rates”, Ms. Yellen told a joint congressional panel.
The Fed’s policy setting committee meets on December 15-16. Year over year, average hourly wages rose 2.3% in November, a bit less than the prior month’s growth.
But at Knox Machinery in Franklin, business has been booming, and the company has been on a steady growth track for months, adding about 30 percent to its workforce in each of the past two years, according to President Greg Knox. “If it were simply stable over time rather than on that declining trend, I think we would be absorbing people who were perhaps discouraged”, Yellen also said.
Advertisement
“Mining and logging lost 11,000 jobs in November”.
