More Jobs and Lower Unemployment in the US as Economy Beats Expectations
In November, American businesses hired more workers than anticipated, adding 199,000 jobs, according to the Labor Department.
This positive trend led to a drop in the unemployment rate to 3.7%, the lowest since July. This news is crucial as the US central bank works to manage inflation by raising interest rates, aiming to slow down rising prices.
Despite concerns that inflation could prompt a recession, the US economy has been resilient, expanding at a rate of 5.2% in the most recent quarter.
The strong job market has supported consumer spending, a key driver of the economy. However, some retailers are cautioning about weakening sales.
Notably, the latest employment report showed a 0.4% increase in average hourly pay from October and a 4% rise since November 2022. While good for workers, this wage growth might complicate the Federal Reserve’s efforts to control inflation.
Hiring in health care, manufacturing, and the government contributed to the job gains, but there was a decline in payrolls for retail, warehousing, and transportation firms, even with the holiday season approaching.
Analysts are closely monitoring the situation as the Federal Reserve has raised interest rates, and there’s speculation about whether rates have peaked or might even decrease next year. The US has been averaging 240,000 new jobs per month over the past year, reflecting a robust labor market amid a challenging economic environment globally.
While the full impact of interest rate hikes is yet to be felt, the current strong economic performance in the US is leaving the Federal Reserve optimistic about its actions so far. However, some caution that uncertainties persist, and the economic landscape could change in the future.
(Original source: BBC News)
https://www.bbc.com/news/business-67662809