The United States economy may be doing better than expected, as one of its prime indicators – the national job market – posted a more robust performance in November. According to the month-end report issued by the Labor Department on Friday, December 2nd, around 263,000 new jobs were added to the employment scene. Again, this is considerably better than the 200,000 previously forecast by economists.
However, the unemployment rate remained static last month, staying at 3.7% as the rank of the unemployed stayed within six million. This was even though numerous corporations have been laying people off for the past several months to streamline their operations or to reduce operational costs.
Robert Frick, a corporate economist from the Navy Federal Credit Union, believes that the job market’s strong performance in November reflects the general improvement of the US economy.
Over the past several months, over 10 million new positions have opened up to job seekers in numerous industries, including healthcare and education.
Many fields are still hard-pressed to restore their employee slates to pre-pandemic numbers. In particular, however, the leisure and hospitality fields are stepping up their employment drives to keep up with the increasing demand, especially now that the travel sector has reopened.
However, market watchers say it is unlikely that the jobs market will fall below 100,000 positions monthly unless an additional two million people rejoin the workforce next year.
What’s Up with the Economy?
The US labor market was one of the sectors hit hardest by the pandemic. More than 20 million positions were axed over the past couple of years as health restrictions led to the closure of numerous establishments.
But over the past year, the labor market has rallied and become one of the prime movers of the country’s economic recovery. Moreover, despite how several sectors have struggled to recover because of the aggressive way the Federal Reserve has raised interest rates to halt inflation, the labor market has remained strong. Moreover, it may continue to get stronger well into next year.
While Fed executives previously cited the way the labor market’s performance is a crucial indicator of economic growth, they now point out that the substantial improvement of the employment scene sets the tone for an eventual slowing of the pace at which rate hikes have been applied.
Indeed, as the US economy shows signs of cooling down, a more comfortable half-point increase in interest rates may be in the offing this month.