Job growth in November fell below expectations growing at a slightly slower pace compared to the past 12 months. The newest numbers on jobs from the U.S. Bureau of Labor Statistics show 155,000 new jobs last month and an unemployment rate of 3.7 percent. That's the 98th straight month of job gains and the lowest unemployment rate in half a century.
The biggest gains were in the healthcare and professional/business services sectors, each up 32,000 jobs. Manufacturing added 27,000 jobs last month; construction employment remained flat.
These latest numbers come amid a volatile stock market and a lot of talk about the Fed moderating the pace of rate increases, which has been spooking investors. Realtor.com's Chief Economist, Danielle Hale, called the report “good, but not great reading.” She said investors are watching the latest job report more closely than usual.
“We want to see wage growth, so that home buyers have more income,” Hale said. “But not so fast that the Fed has to be overly concerned with inflation.”
High up on Hale's radar is the fact that job gains of 155,000 in November are noticeably smaller than the average monthly gain over 200,000 in the last 12 months, meaning the economy is still growing but at a slower pace consistent with the unemployment rate at 49-year lows.
"The unemployment rate reflects a tight labor market as the availability of workers is low," said Tendayi Kapfidze, Chief Economist at LendingTree. “The participation rate of 62.9 percent suggests that people on the sidelines are not sufficiently attracted by the level of wages to enter the job market."
"The updated information released today suggests that the labor market remains strong and inflation remains manageable, supporting our call that the Fed will raise its key policy rate in December," said Doug Duncan, Chief Economist at Fannie Mae. "Meanwhile, the housing sector, another weather-sensitive industry, also registered job gains this month, but the stronger growth in average hourly earnings relative to the private sector overall suggests that labor availability remains a challenge."
In November, 1.7 million persons were marginally attached to the labor force, according to the BLS. That's an increase of 197,000 from a year earlier.
November saw 3.1 percent growth in hourly wages, according to the BLS. Hale said this “is on the upper end of what we’ve seen, but hasn’t surpassed last month’s pace, which may signal that the Fed can take a pause after its widely expected December increase.”
Hale recommended a more measured approach in the pace of short-term rate increases to steady markets; this could help buyers waiting for the right time to lock in a better rate.
“Rising household income mitigated the impact of higher cost mortgages by $12,000,” said Mark Fleming, Chief Economist at First American. “In November, consumer house-buying power declined by $30,000, or 8 percent, compared with a year ago. If household income had not increased compared with a year ago, rising mortgage rates, which jumped from 3.9 to 4.9 percent over the last year, would have reduced consumer house-buying power by $42,000.”