Unemployment drops sharply to 8.6%; job gain is modest
U.S. employers, continuing a pattern of modest hiring, added 120,000 new jobs in November, the Labor Department said Friday.
The nation’s unemployment rate, however, fell sharply to 8.6% from 9% in October. There was an unusually big drop in the number of people who reported being out of work. Many jobless people may have quit looking for jobs, and thus wouldn’t have been counted as officially unemployed. Analysts expect the jobless figure to climb back up next month.
Strong holiday hiring boosted the new job tally last month. Retailers added almost 50,000 jobs, the second strongest November hiring by stores in a decade. Two other lower-paying sectors, temporary-help and leisure businesses, accounted for much of the rest of the job gains. Manufacturing payrolls were flat, and government continued to slash jobs.
On a more positive note, the Labor Department revised upward the job growth in September and October by 72,000 jobs. Job creation in the last three months thus averaged 143,000 a month. That’s almost double the monthly average from May to August, but even at that pace, the unemployment rate won’t come down fast anytime soon.
The latest jobs report comes on the heels of other data suggesting a strengthening of the economy. Consumer spending, manufacturing and exports, and business investment and confidence all have edged higher since summer -- despite significant concerns about the European debt crisis, the still-moribund American housing market, government cutbacks and political paralysis in Washington.
Other indicators also show hints of improvement in the job market. The National Federation of Independent Business, a lobbying group for small firms, said its survey of members in November showed that the average number of workers per firm rose and that plans to create new jobs nearly doubled.
“Overall, the employment indicators delivered a significant positive signal, still at weak levels but a meaningful movement forward,” said William Dunkelberg, the group’s chief economist.
-- Don Lee in Washington