According to the Bureau of Labor Statistics, employment increased by 263,000 in November, still on a steady upward trajectory. This is a strong signal of economic resilience and growth, even against the background of aggressive rate hikes by the Fed.
Key takeaways from the November Jobs Report
- Strong hiring in November defied the efforts of the Fed to cool the job market through interest rate hikes.
- Wage growth has also been robust, putting more pressure on the Fed to continue raising interest rates.
- Jobs data seems to point to a consumer shift from buying goods to buying services.
- Education, health care and hospitality powered the November job gains.
The connection between the labor market and inflation
The labor market affects inflation in several ways:
- In a tight labor market, employers face stiff competition for works and in turn are forced to offer competitive salaries which continue to rise due to this upward pressure, stoking inflation
- People with good paying jobs will continue to pay a premium for goods, even as companies raise prices on them
With the pace of growth outpacing the level at which the Fed thinks is necessary to keep the economy humming, we should expect more rate hikes aimed at tempering this strong growth.
Strong growth in leisure and hospitality
Consumers seem to be enjoying the chance to travel and eat out and therefore leisure and hospitality showed strong gains, adding 88,000 jobs in November. 62,000 jobs were added in food services and drinking places.
Other November Jobs Report Highlights
- Employment in health care grew by 45,000, with gains in ambulatory health care services (+23,000), hospitals (+11,000), and nursing and residential care facilities (+10,000).
- Government added 42,000, mostly in local government (+32,000).
- Employment in social assistance increased by 23,000 and has returned to its February 2020 level. Within social assistance, employment in individual and family services increased by 17,000 in November.
- Construction employment continued to trend up in November (+20,000), with nonresidential building adding 8,000 jobs.
- Employment in information went up by 19,000 in November.
- Manufacturing employment continued to trend up in November (+14,000).
- In November, employment in financial activities continued its upward trend (+14,000). Job gains in real estate and rental and leasing (+13,000) and in securities, commodity contracts, and investments (+6,000) were partially offset by a decline in credit intermediation and related activities (-9,000).
- Employment in retail trade declined by 30,000 in November. Job losses in general merchandise stores (-32,000), electronics and appliance stores (-4,000), and furniture and home furnishings stores (-3,000) were partially offset by a job gain in motor vehicle and parts dealers (+10,000). Retail trade employment has fallen by 62,000 since August.
- Employment in transportation and warehousing declined by 15,000 in November and has decreased by 38,000 since July. In November, job losses in warehousing and storage (-13,000) and in couriers and messengers (-12,000) were partially offset by a job gain in air transportation (+4,000).
- Employment in professional and business services changed little in November (+6,000). Within the industry, professional and technical services added 28,000 jobs, while business support services lost 11,000 jobs.
Catch Up With Previous Jobs Reports
- Resilience in October 2022
- Mixed messages in September 2022
- August 2022’s cooling forecast
- Great job news in July 2022
- Continued growth in June 2022
- Strong growth in May 2022
- Big month of growth in April 2022
- March 2022’s strong growth
- February 2022’s blockbuster growth
- January 2022’s strong growth despite Omicron
- Promising news for hospitality in December 2021
- November 2021’s mixed picture
- October 2021’s robust gains
- A slower-than-expected report in September 2021
- The summer‘s roaring recovery trajectory in 2021
- Better than expected growth in June 2021, especially in travel
- A turnaround in May 2021
- An anemic April 2021 jobs report