The unemployment rate fell from 9.0% to 8.6% in November, however that is not an accurate representation of employment in the USA. The news is good, but very mildly good, while a decrease in the unemployment rate by 40 basis points would lead you to believe the improvement was dramatic. Nonfarm payroll employment rose by 120,000 which is about the number needed to keep up with population growth each month. Employment continued to trend up in retail trade, leisure and hospitality, professional and business services, and health care. Government employment continued to trend down.
The change in total nonfarm payroll employment for September was revised from +158,000 to +210,000, and the change for October was revised from +80,000 to +100,000. This means this report shows an increase of 192,000 jobs which is pretty good news (especially for those that think the economy has been in a recession – it has not).
The number of unemployed persons, at 13.3 million, was down by 594,000 in November. The labor force, which is the sum of the unemployed and employed, was down by a little more than half that amount. What this means is the reduction in the unemployment rate was largely due to the decrease in those actively looking for jobs.
Among the major worker groups, the unemployment rate for adult men fell to 8.3% in November. The jobless rate rates for adult women (7.8%), teenagers (23.7%), African-Americans (15.5%), and Hispanics (11.4%) showed little or no change. The jobless rate for Asians was 6.5%.
The number of long-term unemployed (those jobless for 27 weeks and over) was little changed at 5.7 million and accounted for 43.0% of the unemployed. This is one of the numbers that has to come down drastically for the job situation to really show good improvement.
Related: Jobs News in the USA is not Good, Unemployment Remains at 9.1% (Aug 2011) – USA Economy Adds 151,000 Jobs in October, Unemployment Rate Steady at 9.6% (Oct 2010) – Unemployment Rate Reached 10.2% (Oct 2009) – Over 500,000 Jobs Disappeared in November (2008)
The average gain for the prior 12 months in nonfarm payroll employment is 131,000, a very slight good sign. But given the mood of many people about how the economy has been the last year really pretty positive. We really need to see sustained periods of gains exceeding 200,000 a month to make real headway though.
Health care employment continued to rise in November (+17,000). Within the industry, hospitals added 9,000 jobs. Over the past 12 months, health care has added an average of 27,000 jobs per month.
Meanwhile, government employment continued to trend down in November, with a decline in the U.S. Postal Service (-5,000). Employment in both state government and local government has been trending down since the second half of 2008.
The average workweek for all employees on private nonfarm payrolls was unchanged at 34.3 hours in November. The manufacturing workweek was down by 0.2 hour to 40.3 hours, offsetting a 0.2 hour gain in the previous month. Factory overtime remained at 3.2 hours in November. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged down by 0.1 hour to 33.6 hours.
Over the past 12 months, average hourly earnings have increased by 1.8%. In November, average hourly earnings of private-sector production and nonsupervisory employees increased by 2 cents, or 0.1 percent, to $19.54.