November Jobs stable in U.S. with lowered inflation

Friday’s Jobs Report for November released the magic number of 199,000 new non farm jobs and a declining unemployment of 3.7, signals that the United States economy might just be getting to that long desired, and much anticipated, ‘soft landing,” that so many had hoped for, due in no small part to the efforts of the Federal Reserve Board, and its data driven chair, Jerome Powell; and the good news is a solid employment outlook with declining rates of inflation maybe no future increase in interest rates.

The job gains are due in no small part to the end of the striking auto workers and Hollywood writers, giving a bump that will no doubt be revised, as is standard, for these reports, in the December release, scheduled for January 2024.

Reading the economic news is a bit like reading tea leaves, and the convulsions that most economists have experienced is not due to a misread, but to an often unpredictable, and frequently stubborn numbers that frequently defied standard economic forecast tools that preceded these recent gains.

The Fed, as we have noted before, had a real balancing act: too much action would result in great job losses, often affecting low income workers, and incurring the wrath of Sen. Elizabeth Warren, who had warned Powell months ago that she was watching him.  And, too little would create an overheated economy.

Now all that is left to create peace in the valley are lowered prices, still elusive, but President Biden, who is using these numbers as a plank in his reelection platform, to try and persuade the captains of industry towards that goal. But with high costs of materials and labor costs, plus a recalcitrant House of Representatives and an embattled Senate hamstrung by those pesky Republicans who are holding military aide towards Ukraine hostage for immigration reform over his head, only time will tell, and maybe yet another sacking of the speaker, can this be achieved.

A closer look at the numbers reveal that for November there were 77,000 health care jobs, and 49,000 government jobs both unmoored from the economy, and leisure and hospitality added 40,000 jobs, particularly notable as that industry had struggled and gasped over several months prior to get to this point.

Retail took a nosedive to 38,000 jobs, due in part, some say, to self checkout lanes, but that picture is murky, considering that Americans are spending money on goods, and some are stating that this is due to an abundance of savings, but there is no bright line around that assertion.

Overall retailers had announced 6,548 cuts for November, topping all industries for the month. But, the technology sector is the one that led all sectors in 2023 with 163,562, with 5.049 for that month.

Of interest is that the health care products industry announced 57,758 cuts in November, giving a twist to the growth in health care jobs cited earlier, mostly in ambulatory care services.

“The job market is loosening, and employers are not as quick to hire. The labor market appears to be stabilizing with a more normal churn, though we expect to continue to see layoffs going into the New Year,” said Andrew Challenger, labor expert and Senior Vice President of Challenger,Gray and Christmas, Inc.

Labor force participation has reached 62.8 percent, an increase in a number that economists watch closely, and that  previously hovered at 62 percent, nearly as strong as pre pandemic levels.

“This is encouraging for central bankers and the people getting real wage gains,” Nick Bunker, economic research director at the jobs site Indeed, to The Washington , and “It’s helping people spend more which is good for GDP growth and for everyone. It’s a win-win for a variety of audiences.”

In addition to the music in Powell’s ears of decreased hiring, wages have moderated, and in November that growth was 4.0 percent, reaching $34.10 an hour. 

And more good news: those people working part time, but hoping for full time employment, have decreased to 295,000.