There still is little prospect, however, that the over-reliance on central banks as an elixir for the economy will give way to the broader policy response needed to ensure that growth is sufficiently high, sustainable and inclusive.
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At the same time, USA exports and manufacturing have been crippled by a strong dollar, while low oil prices continue to hurt the country’s important energy sector.
U.S. equity markets took the jobs report as a confirmation that the economy continues to grow at a good pace, with the S&P 500 surging 2.1 per cent. The median outlook was for four quarter-point hikes next year, while their views of the long-term normal level range from between 3 percent and 4 percent.
The closely watched employment report came a day after Fed Chair Janet Yellen struck an upbeat note on the economy when she testified before lawmakers, describing how it had largely met the criteria the USA central bank has set for the Fed’s first rate hike since June 2006.
Because interest-rate changes affect the economy with a lag, central bankers can’t afford to wait until inflation is approaching risky levels before acting.
Wages are continuing to rise, but not so much as to cause concern about future high inflation.
Average hourly earnings jumped to $25.25 and are now up 2.3 percent from this time previous year.
Yet after employment gains bounced back smartly from a two-month slump in October, economists said it was unlikely a weak November showing would dissuade Fed policymakers from boosting the rate, especially since the figures are often revised.
Analysts said it was near certain that the Fed, after keeping policy on hold for months awaiting more evidence of economic strength, would undertake its first rate increase in more than nine years at its upcoming meeting.
Job gains were broad-based across the economy in November.
With the November report, the United States has added and average 237,000 new jobs each month in the past year, and the number of officially unemployed people has fallen by 1.1 million. Spending on construction projects, including homes, roads and office towers, reached an eight-year high in October.
While payroll gains would need to be larger than that to encourage discouraged workers back into the labor force, even that threshold would still be “quite a bit less” than 200,000 per month, she said.
Though Yellen said Thursday that the Fed looks forward to a rate hike as proof of the economy’s recovery, the central bank faces an increasingly weighty decision.
Restaurants and bars added 32,000 jobs; retail, 31,000; professional and technical services, 28,000; and health care, 24,000. The remainder-those who have no job and are not looking for one-are counted as not in the labor force.
“This time, I felt like I could be a more picky”, said Raminhos, 29.
More jobs with heftier pay checks are lifting Americans’ ability to spend.
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With China and other emerging economies decelerating, the USA – the epicenter of the financial shock wave that hit the world – has become the only real driver of the global economy. The Institute for Supply Management said Tuesday that its USA manufacturing index fell to a six-year low in November, signaling contraction. Auto sales were again very strong in November: 18.19 million at an annualized rate.
