The unemployment rate remained 5 percent for the second straight month as more Americans entered the workforce to look for jobs.
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Yellen mentioned that the economy is required to generate only under 100,000 jobs every month to maintain growth in the working age population.
The employment trends have eased fears that economic growth was beginning to stall and nearly guarantee that the Fed will raise interest rates later this month for the first time since June 2006, according to Ken Mayland, president of ClearView Economics, an economic-forecasting firm near Cleveland.
The number of long-term unemployed, referring to those jobless for 27 weeks or more, was 2.1 million in November, accounting for 25.7 percent of all the unemployed.
Meanwhile, average hourly earnings increased by four cents to $25.25, or 0.2%, following a 0.4% rise in October. Wage growth remained in its same old 2-2.5 percent range, though it dipped down a little between October and November.
In November, 60.5% of industries reported higher employment, the largest share since February and up from September’s five-year low of 54.2%. The clear message from the labor market to the Fed is: “‘Just do it!'” said Harm Bandholz, chief USA economist at UniCredit Research in NY.
Construction companies took on 46,000 workers, led by residential specialty contractors and boosted by warmer weather across much of the U.S. Payrolls at retailers rose by nearly 31,000 in November, a step down from the month before. Cheap oil has stunted business for energy producers, which have cut 124,000 jobs in 2015.
“The Fed says its actions are data-dependent, and this (jobs report) is a piece of data that argues for a rate increase”, Mayland said. It is imperative to state that employers have now added an average of 213,000 a month over the last six months. Yellen on Thursday said before Congress that the US economy has “recovered substantially”, and noted “continued improvement in the labor market”. Manufacturing contracted in November for the first time in three years. It would also bring an end to the zero-interest-rate policy put in place in December 2008. “Barring something completely out of left field between now and then, liftoff will commence with a quarter-point rate increase to the target federal funds rate”. September’s gain was revised up to 145,000 from 137,000.
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Yellen and her fellow central bankers have said repeatedly the decision to raise rates will be “data dependent”. Global money is flowing back into the dollar amid expectations of a USA rate hike, which could strengthen the greenback further. The data “would appear to seal an interest rate hike at the Fed’s upcoming FOMC meeting”.
