Weak Jobs Report May Add Fuel to Stimulus Fire
245,000 Jobs Added; Unemployment Slides to 6.7%
Adding urgency to pandemic relief talks among lawmakers, the U.S. economy added just 245,000 jobs in November, about half the number expected and far less than in any other month since the labor market began recovering.
The nonfarm payroll increase was well below the consensus forecast of 485,500 jobs cited by Moody’s Analytics and came mostly from a holiday ramp-up in transportation and warehousing that added 145,000 jobs in that sector, according to Friday’s report from the Bureau of Labor Statistics. The unemployment rate fell slightly to 6.7% from 6.9% in October, but economists said this was due to people leaving the labor force.
- The U.S. economy added 245,000 jobs in November, only half the number expected and far fewer than any month since the economy began to recover from the pandemic.
- President-elect Joe Biden called the report “grim” and called upon lawmakers to pass a stimulus bill quickly.
- The transportation and warehousing sector was responsible for most of the job growth as employers geared up for the holiday shopping season.
The report could help motivate lawmakers to pass a new economic rescue package, and President-elect Joe Biden cited it as he doubled down on calls for Congress and President Donald Trump to get a deal done Friday. A bipartisan group of legislators proposed a bill this week that included $908 billion in aid, including $288 billion for the Paycheck Protection Program, $180 billion for unemployment insurance, and $160 billion for state, local, and tribal governments.
“This is a grim jobs report,” Biden said in a statement. “It shows an economy that is stalling. It confirms we remain in the midst of one of the worst economic and jobs crises in modern history.”
The economy still has 9.8 million fewer jobs than it did in February, before the COVID-19 pandemic gutted the labor market. In April alone, lockdowns triggered by the pandemic led to more than 20 million job losses. November’s 245,000 increase in nonfarm payrolls is by far the slowest monthly growth since the recovery began in May, and follows a 610,000 jump in October.
What’s more, economists noted that the report reflects activity in mid-November, before surging COVID-19 cases prompted some states to impose additional restrictions and more people to voluntarily stay home.
“The American labour market hit a major speedbump in November due to the second wave of the coronavirus,” Sal Guatieri, senior economist at Montreal-based BMO Economics, wrote in a commentary. “A vaccine can't come soon enough.”
The report also showed fewer of those who were laid off expect to be called back to their old jobs: the number of workers who say they are temporarily unemployed fell to about 2 million over February’s levels, implying that about 80% of the jobs lost in the pandemic are seen as permanent, according to Conrad DeQuadros, senior economic advisor at Brean Capital.