Ahead of jobs report, Yellen says 100000 would cover new entrants

This comes after last month’s positive report that jobs surged to 271,000. Also, the rise in wages appears slanted toward management: Average hourly earnings for production and nonsupervisory employees increased at an annualized rate of 1.9 percent in the three months through November, less than the 2.4 percent gain for all employees.

Unemployment rate now sits at 5 percent, a 7-1/2 year low.

“To simply provide jobs for those who are newly entering the labour force probably requires under 100,000 jobs per month”, with anything above that helping “absorb” those who are unemployed, discouraged or had dropped out of the labour market, Ms. Yellen, who was speaking before Congress’ Joint Economic Committee, said in a question and answer session.

Fed Chair Janet Yellen twice this week expressed confidence that the USA economy is growing strongly enough to justify raising the federal funds rate, which has been stuck at 0-0.25 per cent since December 2008 to support a rebound from the Great Recession.

A weaker dollar tends to boost gold prices, which are denominated in the US currency, by making the metal more affordable to overseas investors.

The sizable gain in construction jobs last month, even as the Fed is preparing to raise rates, suggests that few expect higher borrowing costs to derail home building or sales. Average weekly earnings declined to $871.13 from $872.27 last month, partially a result of weekly hours worked declining from 34.6 to 34.5.

The jobs report for November released Friday doesn’t just make it a near-certainty that the Federal Reserve will hike interest rates later this month. It would be the Fed’s first rate increase in almost a decade. “The second hike, we think, will come in March, as unemployment continues to fall and wage gains pick up further”, he said.

Total non-farm payroll employment increased by 211,000 in November, and the unemployment rate was unchanged at 5%, the Labor Department said Friday.

The US economy has averaged the creation of 210,000 jobs per month throughout 2015.

Still, the jobs report showed United States wage growth remains subdued, one of the signs of slack in the jobs market the Fed is watching before moving to raise the rate. There was a loss of 11,300 jobs in mining with 2,400 jobs lost in oil and gas extraction in November.

Still, Mayland cautioned that while a rate hike is expected, it’s not a done deal. Nonetheless, the structural headwinds facing the USA economy highlight the additional need for a policy response that extends far beyond central banks and must include governments and legislatures. The median outlook was for four quarter-point rises next year, while their views of the long-term normal level range from between 3.0 percent and 4.0 percent. The Fed has kept its key short-term rate at a record low near zero for seven years. Over the year, professional and technical services has added 298,000 jobs.