The unemployment rate dropped to 8.6 percent in November, the lowest it has been since March 2009, as the U.S. economy added 120,000 jobs.
The job growth announced this morning by the U.S. Department of Labor was at the low end of the various estimates of what economists were expecting, though some predictions were upped following a robust report Wednesday from payroll and HR services firm ADP. The company said 206,000 private sector jobs were added.
The U.S. Labor Department report said private sector, non-farm payrolls increased by 140,000 jobs, but cuts in government jobs decreased the overall number.
The government also revised up the number of new jobs originally reported for September (158,000 to 210,000) and October (80,000 to 100,000).
Wall Street responded to the report by driving up stock prices, not with the same frenzy as it did earlier this week, but still with strength. At mid-morning in New York, the Dow was up almost 100 points.
While any reduction in the unemployment rate is good news, some of it is attributable to a decrease in the number of workers in the labor force. (The labor force is the count of the unemployed and those who have jobs, whether full or part-time.)
The U.S. Bureau of Labor Statistics, which issues the monthly jobs numbers, said 315,000 Americans had dropped out of the labor force. What happened and why isn’t part of the report. However, the BLS said 2.6 million people (not seasonally adjusted) are considered “marginally attached,” meaning they wanted and were available for work, and had looked for a job sometime in the prior 12 months, but because they didn’t look for a job during the monthly survey period and weren’t employed, are not included in the labor force count.
A blog post by the Wall Street Journal does a good a job of explaining the nature of the unemployment numbers, which come from one kind of survey, and the jobs numbers, which come from a wholly different type of count.
Overall the ranks of the unemployed decreased by almost 600,000. That leaves 13.3 million people out of work. Another 8.5 million people are working part-time because they can’t find full-time jobs.
Whatever the reason, Americans are feeling more confident, at least according to surveys. The Conference Board’s Consumer Confidence Index jumped 15 points during the month.
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Joanie Ruge, SVP & chief employment analyst with Randstad Holding U.S., noting that the company’s Employee Confidence Index is also rising, said, “Consumers are feeling more positive about their personal employment situation and more optimistic about the economic environment overall.”
The confidence, she observed, is fueling the surge in holiday spending this year, which has so far been running ahead of 2010. “Retail sales were up 7 percent over 2010, with buyers spending $11.4 billion at retail stores and malls this year, marking the biggest year-over-year increase since 2007,” Ruge said, adding that retailers have added perhaps as many as half-a-million seasonal jobs.
“Taking all these factors into consideration, we believe this year will close with moderate but steady economic growth and will continue that trend as we enter 2012. And, since the temp industry is considered a leading economic indicator, it is great to see the sector continue to post year-over-year growth.”
Retail, the BLS said in its report, was responsible for more than a third of the private-sector job growth in November, adding 50,000 positions. Food and drink establishments added 33,000 jobs, offsetting the loss of 12,000 hotel and accommodation jobs.
Healthcare, which has averaged 27,000 new jobs a month over the last year, increased by 17,000. Employment in professional and business services continued to trend up in November (+33,000). Modest job gains continued in temporary help services.
Manufacturing and construction businesses were essentially flat, as they have been for months. Hours for manufacturing workers declined by 0.2 hours to 40.3 hours, offsetting a 0.2 hour gain in the previous month. Factory overtime remained at 3.2 hours in November.