Economy Adds 211K Jobs; Unemployment Rate Remains at Five Percent

Payrolls climbed by 211,000 last month following a 298,000 gain in October that was larger than previously estimated, Labor Department figures showed Friday.

That was more than the 190,000 expected, while the Labor Department also reported upward revisions to September and October hiring.

James Bullard, the more hawkish head of the St. Louis Fed, followed that presentation with one that argued it is time to raise rates and to begin shrinking the central bank’s $4.5 trillion balance sheet which was bulked up in recent years to boost the economy.

The November jobs report is out, and it’s meeting what were moderately high expectations.

The figures underscore Fed Chair Janet Yellen’s view that slowdowns in emerging markets or Europe won’t derail the US expansion, clearing the path for officials to raise the benchmark interest rate this month for the first time since 2006.

Yellen said the economy needs to create just under 100,000 jobs a month to keep up with growth in the working age population. T’was lo these seven years ago, on December 15, 2008, that the Federal Reserve set the target interest rate to zero.

“You have an open debate between doves and hawks as to what the pace of increases should look like”, said Art Hogan, chief market strategist at Wunderlich Securities in NY, referring to the divisions within the Fed over readiness to tighten monetary policy. Of course, the Fed will still be watching the data to decide how much to move, which means jobs day will continue to be important as we go into 2016. US stocks ended higher.

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. Manufacturing contracted in November for the first time in three years, according to one business survey.

On the USA economy, Harker said he projects steady and modest growth going forward.

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. Some economists point to the lagging pay as evidence that the job market isn’t as healthy as the low unemployment rate would suggest. The Fed might have been swayed by a really weak payrolls number, but this was not it. Year over year, average hourly wages rose 2.3% in November, a bit less than the prior month’s growth. The unemployment rate held steady at 5 percent.

Durable goods employment declined by 6,000 for the month, offsetting a gain of 5,000 for nondurable goods.

Other labor market measures watched by Fed officials were mixed. “The more purchasing power we take away from people who don’t have it, the harder it’s going to be for them”, Rogers said. That reflected an increase in part-time workers.

Payrolls at retailers rose by nearly 31,000 in November after a 40,600 gain, the strongest back-to-back gains since past year as merchants prepared for the holiday-shopping rush. It ticked up to 9.9 percent last month. They include a strong dollar, which has made exports pricier overseas and squeezed US manufacturers, and sinking oil prices, which have led drilling companies to slash orders for steel pipes and other equipment.

Mining employment has declined by 123,000 since reaching a peak in December 2014.

Oilfield services provider Schlumberger (SLB.N) this week announced another round of job cuts in addition to 20,000 layoffs already reported this year.