The U.S. economy added 266,000 jobs in November, according to the U.S. Bureau of Labor Statistics, with the unemployment rate holding steady at 3.5%.
“It’s a significant surprise because economists were ready to go with the idea that payroll growth was slowing down because the job market had gotten tight,” said Stephen Stanley, Chief Economist at Amherst Pierpont in an interview with Bloomberg. “The whole tenor has changed in terms of job growth. We’re back at steady-as-she-goes at a robust pace.”
Bloomberg reported the jobs report is the best since January and topped all estimates, with its latest survey projecting 180,000 jobs to be added. It was also the first month General Motors Co. workers returned after a 40-day strike, adding 41,300 jobs to automaker payrolls.
“Overall, this positive report should provide no reason for the Federal Reserve to move away from a ‘hold’ stance towards future rate cuts,” said Doug Duncan, Chief Economist, Fannie Mae.
November’s unemployment rate of 3.5% matched the lowest since 1969. The unemployment rate of 3.2% for both men and women over the age of 20 was unchanged from the month prior.
The African-American unemployment rate held steady at 5.5% and the Hispanic unemployment rate was also unchanged at 4.2%.
Additionally, average hourly earnings for all employees rose by 7 cents in November to $28.29. Wages have grown by 3.1% year-over-year.
Duncan said the one piece of “lackluster news” was that residential construction posted a small decline in November. The Bureau reported that the employment of residential specialty trade contractors fell 2.3% from October.
He noted that the “hopes for an acceleration of housing supply growth will be disappointed.”
Odeta Jushi, First American Deputy Chief Economist, said the outlook for consumer economic strength remains strong as 70% of the U.S. economic growth is driven by consumer spending.
“Today’s numbers point to a more competitive housing market next year. ...Housing is the most durable consumer good we’ll ever buy and surging house-buying power fuels greater potential demand in a supply-constrained market,” Kushi said. “There's no evidence that these dynamics will change in 2020.”