Rosey Jobs Numbers for November
Dec. 8, 2006 — -- This morning's jobs report showed a month of strong growth: 132,000 new positions were added to the U.S. workforce in November, on top of a net upward revision for September and October of 42,000 positions, according to the Bureau of Labor Statistics.
The November figure tops the best guess of economists, which was around 92,000 new jobs for the month.
The nation's unemployment rate ticked up one-tenth of a percent to 4.5 percent. The move isn't significant, but it is important to keep in mind that this level of unemployment is historically low by American standards. Most economist believe we're at "full employment" when the economy has about 5 percent of workers without a permanent position.
What's this mean for the economy? The better than expected job creation in November supports the idea that the economy is on relatively solid footing right now, despite a recent slowdown. Could we be seeing the much ballyhooed "soft landing" that Federal Reserve Board governors have been dreaming about? Maybe.
Also revealed in today's report were wages that are increasing at a pace not seen in years, as unemployment is relatively low. That means companies have to raise wages to attract and retain workers to sustain growth. That might be helping bolster "consumer comfort" -- measured weekly by ABC News -- which has been near multi-year highs in the past few weeks.
Where Did the Jobs Come From?
It's the same song we've been singing for years -- the American service sector is growing, while companies which make things are slowly winnowing their workforces.
During November, the construction industry bled jobs (-29,000), while manufacturers laid off general production workers (-15,000) and people who put together transportation equipment (-8,300).
But turn the page and you'll see some positive news from the service-providing sector of the economy. Retailers (+20,400) -- specifically clothing stores (+12,900) -- hired like crazy during the month to prepare for the holiday rush. Financial service providers (+11,000), health care companies (+27,700), restaurants/bars (+33,600) and public schools (+10,400) also added employees to the payroll last month.
How much does this matter? This is important. The jobs report is arguably one of the most important economic indicators out there, and it's easy to understand. That said, the recent trend of offering big revisions to the monthly numbers has some questioning the report. There might be a growing chorus of voices asking for changes in the way BLS calculates the numbers.
Definition: The non-farm payrolls number is a measure of the number of new jobs created by the private sector during the month. It is based on a survey of about 160,000 businesses and government agencies. The national unemployment rate comes from a separate survey of households.