Friday’s Employment Situation report from the Bureau of Labor Statistics is strong enough to support the pending first Federal Reserve interest rate hike in years. The reality is that the payrolls were stronger than expected for November, and a strong October was revised to be even stronger.
Nonfarm payrolls grew by 211,000 in November, versus a Bloomberg consensus of 190,000. Dow Jones (via the Wall Street Journal) had projected 200,000. October’s nonfarm payrolls were also revised higher to 298,000 from a preliminary report of 271,000.
Private sector payrolls grew by 197,000 in November. Bloomberg was calling for 185,000 here, and the October report was revised to 304,000 from 268,000.
November’s unemployment rate is still flat at 5.0%. Both Bloomberg and Dow Jones had 5.0% as the consensus.
One positive thing was also seen in November’s Labor Force Participation Rate. This has remained embarrassingly low, but it ticked up to 62.5% in November from 62.4% in October.
Average hourly earnings gained 0.2% and the average work week was 34.5 hours, both exactly in line with Bloomberg and Econoday projections.
What stands out in the unemployment and payrolls report is that Janet Yellen and the Fed presidents have the full employment status in their pocket in an effort to raise interest rates. That would get fed funds off the 0.00% to 0.25% target that has been in place for the entirety of this presidential administration.
To calculate the data, the Bureau of Labor Statistics surveys approximately 143,000 businesses and government agencies, representing approximately 588,000 individual worksites.
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