The US economy experienced a boost in employment in the month of November, with the number of non-agricultural jobs increasing by 199,000 people. This increase is attributed to the closure of historic strikes against the Big Three of the US motor industry and the resolution of conflicts with Hollywood screenwriters and actors.
The unemployment rate, which is measured by a household survey, fell to 3.7%, marking almost three years of strong dynamism in the labor market. While the pace of job creation has been cooling in the second half of the year, the November figures confirm that the labor market remains robust.
Despite the somewhat distorted November figures due to the end of the strikes, they suggest that the labor market has lost some strength but remains robust. Job growth in November is lower than the average increase of 240,000 per month over the previous 12 months.
The end of the motor strike provided some 30,000 jobs in the month, while the film and sound recording industries created 17,000 jobs due to the resolution of strikes and labor disputes in the sector. Retail employment decreased by 38,000 people, with half of the losses occurring in department stores.
The Federal Reserve will likely maintain interest rates in the last meeting of the year, scheduled for the following week. The decline in inflation itself increases real interest rates, leading the market to bet more on when the first rate cut will arrive than on additional increases.
In November, the average hourly wage for nonfarm private sector employees increased 12 cents, or 0.4%, to $34.10. Over the past 12 months, the average hourly wage has increased 4%, down from 4.1% the previous month. This cooling is seen as a good sign in the battle against inflation.
Labor market conditions appear to be normalizing and achieving a greater balance between supply and demand following post-pandemic rigidities. The difficulties that some companies have had when finding workers also mean that they are thinking more about potential layoffs in the face of weakening demand. The US economy is preparing for what appears to be a soft landing in the midst of a weakening demand that allows inflation to be contained without falling into a full-blown recession.