After a pause, hiring picked back up in November. Here are the five things we learned from U.S. economic data released during the week ending December 6.
Employers resumed hiring in November. Nonfarm payrolls grew by a seasonally adjusted 227,000, a strong rebound from the tepid 36,000 added jobs in October but below September’s 255,000 increase. The Bureau of Labor Statistics had upwardly revised the two previous months’ estimates by a combined 56,000 jobs. Private sector payrolls expanded by 194,000 workers, including 160,000 in the service sector. Industries reporting the biggest increases were health care/social assistance (+72,300), leisure/hospitality (+53,000), government (+33,000), professional/business services (+26,000), and manufacturing (+22,000). Average weekly earnings of $1,221.42 were up 3.7 percent from a year earlier.
Based on a separate household survey, the unemployment rate grew by 1/10th of a percentage to 4.1 percent. A year earlier, the unemployment rate was at 3.7 percent. 193,000 people left the labor force, leading to a 1/10th of a percentage point drop in the labor participation rate (62.5 percent). The labor force participation rate for adults 25-54 held steady at 83.5 percent. The median length of unemployment grew by a half week to 10.5 weeks (November 2023: 9.0 weeks). 4.457 million people held a part-time job for (economic reasons), down 100,000 from October. The broadest measure of labor underutilization (the U-6 series) inched up by 1/10th of a percentage point to 7.8 percent.
Manufacturing activity contracted in November. The Institute for Supply Management’s Manufacturing PMI added 1.9 points to 48.4. The Manufacturing PMI has failed to top 50.0—the threshold between an expanding and contracting manufacturing sector—for 24 of the past 25 months, including the last eight. Index components for new orders, production, employment, and inventories all expanded in November. Only three industries—food, computer/electronics, and electrical equipment/appliance—reported growing during the month. Survey respondents indicated that “[d]emand remains weak.”
The service sector expanded at a slower pace in November. The ISM’s Services PMI lost 3.9 points to 52.1. Despite the drop, the Services PMI was above 50.0 for a fifth consecutive month. Indices for business activity/production, new orders, employment, and inventories all declined during the month. Fourteen service sector industries expanded in November, led by accommodation/food services, arts/entertainment, and health care/social assistance. The press release noted that “the services sector has returned to sustained growth.”
The trade deficit narrowed in October. Exports slumped 1.6 percent to a seasonally adjusted $265.7 billion and imports slowed 4.0 percent to $339.6 billion. The resulting trade deficit of -$73.8 billion left the Census Bureau and Bureau of Economic Analysis measure down 11.9 percent for the month and the year-to-date deficit of -$735.9 billion up 12.3 percent over the comparable 2023 months. The goods deficit fell by $10.4 billion to -$98.7 billion, while the services surplus contracted by $0.4 billion to +$24.8 billion. The former reflected declines in exported capital goods, automotive vehicles, industrial supplies/materials, and consumer goods outpaced by declining imports of computers, semiconductors, crude oil, pharmaceutical preparations, and automotive vehicles. The U.S. had its largest surplus deficit with China, the European Union, Mexico, and Vietnam.
Consumer sentiment edged up again in early December. The University of Michigan’s Index of Consumer Sentiment added 2.2 points to a seasonally adjusted 74.0 (1966Q1=100). The index was up 6.2 percent from a year earlier. The current conditions index surged 13.8 points to 77.7 (+6.0 percent versus December 2023), while the expectations measure fell 5.3 points to 71.6 (+6.2 percent versus December 2023). The press release notes that expectations improved for Republicans but fell among Democrats post-election. One-year inflation expectations grew by 3/10ths of a percentage point to +2.9 percent.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending November 30, 2024, First-Time Claims, seasonally adjusted): 224,000, +9,000 vs. the previous week, +8,000 vs. the same week a year earlier). 4-week moving average: 218,250 (-+0.5% vs. the same week a year earlier).
- Factory Orders (October 2024, New Orders for Manufactured Goods, seasonally adjusted): $586.7 billion (+0.2% vs. September 2024; +2.3% vs. October 2023).
- Construction Spending (October 2024, Value of Construction Put in Place, seasonally adjusted annualized rate): $2.174 trillion (+0.4% vs. September 2024; +5.0% vs. October 2023).
- Vehicle Sales (November 2024, Auto and Light Truck Sales, seasonally adjusted annualized rate): 16.495 million (+1.5% vs. October 2024; +6.7% vs. November 2023).
- Consumer Credit (October 2024, Outstanding Non-Real Estate Consumer Credit Balances, seasonally adjusted): $5.113 trillion (+$19.2 billion vs. September 2024; +2.3% vs. October 2023).
- Agricultural Prices (October 2024; Prices Received by Farmers, not seasonally adjusted): -6.5% vs. September 2024; -1.1% vs. October 2023.
- Beige Book
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What We Learned About the U.S. Economy Last Week 