United States: Unemployment increases on weaker-than-expected payroll growth
December 3, 2010
In November, the economy added 39,000 jobs, after an increase of 172,000 in October (previously reported: +151,000 jobs). The figure surprised the market on the downside, as private sector analysts had expected job gains of 168,000. As a result of the weaker-than-expected monthly reading, the unemployment rate increased from 9.6% in October to 9.8% in November. The soft November reading reflected weak private sector hiring, as private non-farm payrolls increased by 50,000 units, down from the 160,000 boost in October. Meanwhile, the public sector cut 11,000 jobs in November, which almost entirely offset the job growth of 12,000 seen in the previous month. The economy lost an accumulated 8.3 million jobs between December 2007, the official start of the recession, and December 2009. Over 2010, the economy recovered less than one million jobs, indicating that the US labour market recovery is not yet firmly entrenched. Consensus Forecast panellists expect the unemployment rate to average 9.7% in 2010, and to decline slowly to an average of 9.4% in 2011.