Economists polled by Reuters had forecast payrolls accelerating by 200,000 jobs last month, following an increase of 12,000 in October.
Estimates ranged from 155,000 to 275,000 jobs. Economists have suggested averaging October and November payroll increases to get a clearer trend in job growth. The labor market suffered in October due to hurricanes Helene and Milton, as well as a large strike at Boeing factories on the West Coast.
It is also likely that the initial October payroll count was reduced by a shorter period of collecting responses to the establishment survey from which the payrolls are derived.
The initial response rate to the survey was 47.4%, the lowest since January 1991 and well below the average of 69.2% recorded in October in the last five years.
The response collection period was only 10 days, at the lower end of the normal 10-16 days. Other labor market indicators, including first claims for state unemployment benefits, are consistent with a healthy but slowing labor market.
The unemployment rate rose to 4.2% after remaining at 4.1% for two consecutive months. Average hourly earnings increased 0.4% after improving 0.4% in October. In the 12 months to November, wages rose 4% after a similar advance in October.
Financial markets now see a 72% chance of a 25 basis point rate cut at the Fed’s Dec. 17-18 policy meeting, according to CME’s FedWatch tool.
The Fed has lowered rates by 75 basis points since September, when it began its easing cycle. The official rate now stands at 4.5%-4.75%, after having risen 5.25 percentage points between March 2022 and July 2023.
