Nation’s Jobs Numbers Hold Steady, Interest Rates Poised to Rise

“There’s nothing in the details that suggests anything other than a healthy and rapidly growing labor market”, said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

In its November 2015 Employment Situation report, released Friday, the Labor Department also upwardly revised its employment figures for September and October, saying 35,000 more jobs were created than initially estimated.

For months now, the November jobs report has been hotly anticipated as a marker not just for how well the economy is doing, but a hint at how the country’s most important bank would move to shape it. Happily, it did not disappoint. Over the past three months, job gains have averaged 218,000 per month.

Here’s what you need to know from this month’s jobs report.

Fed Chair Janet Yellen told Congress Thursday that she is seeing a lot of economic data showing the recovering economy no longer needs such help.

“The Fed raised expectations (for a rate hike) at its September meeting, and didn’t follow through”, he said.

The agency says, “The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 2.1 million in November and has shown little movement since June”. The Fed’s first rate hike, expected to be 25 basis points, will start what is expected to be a slow cycle of policy tightening that may see rates remain below normal for years to come.

But Yellen cautioned that they would not be swayed by any single economic report and instead would look at the jobs data in the context of underlying trends.

That pushed up a broader measure of unemployment – that includes those workers, the unemployed as well as discouraged Americans who have stopped looking for jobs – to 9.9% from 9.8%.

The Department of Labor announced this morning that employers added 211,000 jobs in November. That’s a sign people think more jobs are available.

Average hourly earning rose 4 cents to $25.25 last month; average hourly earnings have risen by 2.3 percent over the past year. Most economists have forecast that it will grow at a still relatively subpar 2.5 percent this year, only slightly above its average pace since the recession officially ended in mid-2009. “It will have to be a disaster for the Fed to delay until 2016”, said Ryan Sweet, senior economist at Moody’s Analytics in Westchester, Pennsylvania.

Despite steady hiring gains and a falling unemployment rate, wage growth has mostly been stagnant in recent years, barely above 2 per cent on an annual basis.

The chief economists at Fannie Mae, Doug Duncan, and Freddie Mac, Sean Becketti, both called the report solid, noting in particular that construction jobs rose. The construction sector led the increase with 46,000 jobs added, along with a gain of 28,000 in professional services, 24,000 jobs added in the health-care sector and 31,000 jobs added in the retail sector.