United States Unemployment

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United States: Strong payroll growth and steady unemployment sets stage for Fed rate hike

December 4, 2015

Non-farm payrolls grew by 211,000 in November, which was below October’s upward revised increase of 298,000 (previously reported: +271,000), but exceeded market expectations of a 190,000 increase. The solid result comes just a few days after Federal Reserve Chair Janet Yellen expressed that the U.S. economy is in good enough shape to withstand the effects of an interest rate hike.

The private sector was responsible for the bulk of new hiring, having added 197,000 jobs in October. The largest gains were registered in the leisure and hospitality, healthcare, professional business services and retail sectors. The public sector added 14,000 jobs in November.

The unemployment rate—derived from a different survey—held in November at October’s 5.0%. The print was in line with market expectations and continued to mark the best reading since April 2008. The unemployment rate is below the Fed’s target zone of 5.2%–5-5%, although the labor participation rate is still significantly low. Labor participation came in at 62.5% again in November, marking the lowest level in several decades. Moreover, the underemployment rate, a more complete measure which takes into account discouraged workers and part-time workers who want full-time jobs, ticked up from an over-seven-year low 9.8% in October to 9.9% in November. Meanwhile, average hourly earnings increased 0.2% over the previous month, which was below October’s 0.4% gain. Annual wage gains decreased from a six-year high of 2.5% in October, to 2.3% in November.

FocusEconomics Consensus Forecast panelists expect unemployment to average 5.5% this year, which is down 0.1 percentage points from last month’s forecast. For 2016, the panel expects the unemployment rate to drop to 5.2%, which is blah blah blah .


Author:, Economist

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United States Unemployment Chart


USA Unemployment November 2015

Note: Month-on-month variation of non-farm payrolls in thousands and unemployment rate, seasonally adjusted in %.
Source: Bureau of Labor Statistics


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