How the Upbeat Jobs Report May Not Fatten Your Wallet
The economy added 321,000 jobs last month, with the jobless rate at 5.8 percent.
— -- While economists say today's jobs report is a sign of a stronger labor market, many Americans are squinting in search of the evidence in their paychecks.
Wage growth has remained "stubbornly low" since the recession, chief economist Lindsey Piegza of Sterne Agee says.
The U.S. economy added 321,000 jobs in November, the strongest gain since January 2012, while the unemployment rate remained steady at 5.8 percent. Even the number of jobs gained in October was revised upward to 243,000.
More good news, economists say, is that average hourly earnings for workers on non-farm payrolls rose by 9 cents to $24.66 in November.
Such data may be particularly poignant for the Federal Reserve. Fed chairwoman Janet Yellen has been careful about easing the central bank's monetary stimulus without evidence that Americans are seeing some wage advances.
The Labor Department reported today that average hourly earnings rose 0.4 percent in November, the largest monthly increase since June 2013. Average hourly earnings are up 2.1 percent from a year ago, compared with 2 percent reported last month.
But Piegza told ABC News, “Despite this morning’s monthly increase of 0.4 percent, pulling the annual rate up from 2 to 2.1 percent in November, the longer-term trend remains unchanged with average hourly earnings stagnant at 1.9 percent since the end of the Great Recession."
Piegza says the other not-so-rosy issues are the multi-decade low in the labor force participation rate, though it didn’t drop this time; still-heightened long-term unemployment and a heavy reliance on part-time unemployment.
At least the average workweek rose by 0.1 hour to 34.6 hours last month.
PNC chief economist Stuart Hoffman's note in his analysis states, "Combining more workers, higher average hourly wages and a steady average workweek, workers' earned income rose by a solid 0.7 percent in November."
Peter Morici, University of Maryland professor at the Robert H. Smith School of Business, points out that nearly one in 6 men between ages 25 and 54 -- too old for college and too young to retire -- are jobless.
"Many are simply sitting on America's new virtual park bench at home watching ESPN and relying on friends and relatives for support," Morici wrote in a note.
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