Recession days may be behind us, according to the government’s November jobs report, but some economists in scrutinizing the report say there is more to recovery than what may be a temporary boost in jobs.
On Friday, the Labor Department announced that "the U.S. economy added 321,000 jobs in November, the strongest month of hiring in nearly two years," reported the Atlantic. The increase exceeds the Federal Reserve's modest prediction of 230,000.
"Some were quick to note that the total addition of 2.65 million American jobs in 2014 would make it the biggest since the late 1990s.
November's report also meant that the American economy has added jobs for 50 consecutive months, an all-time national record," continued the Atlantic.
“Virtually every industry added employees, and many of the new jobs were in fields that pay well,” reported MarketWatch, noting the gains occurred primarily in white-collar professions, retail, health care and manufacturing.
“We’ve put more people back to work than Europe, Japan and all other industrialized advanced countries combined,” said President Obama in a speech Friday.
The country’s unemployment rate remains at the same six-year low it was last month, 5.8 percent, according to the Labor Department. Even Millennials are doing better than a year ago, the unemployment rate for 25- to 34-year-olds dropped from 7.4 percent to 6.1 persent, wrote the Atlantic.
Now for the caveats.
Part of the growth may be short lived since 50,000 of the new jobs added in November were in retail “in anticipation for the best holiday shopping season since the recession,” reported MarketWatch.
Wage growth has stalled, increasing by only 0.4 percent in November, far below the Fed’s 3.5 to 4 percent growth target. Inflation is rising faster than wages, keeping personal finances tight across the country, reported the Wall Street Journal.
Also, underemployment is rampant. Some 18.1 million Americans work part time, but want full-time work, reported MarketPlace.
The so-called “real unemployment rate,” also known as U6 by the Bureau of Labor Statistics, captures underemployment as well as workers who have been discouraged from looking for a job in the last four weeks, but would still like to work. In November, the U6 rate “ticked lower from 11.5 percent to 11.4 percent but remains elevated,” according to Forbes.
Unemployment rates also differ among educated workers. “Among workers with less than a high school degree, the jobless rate was 8.5 percent,” the Wall Street Journal reported. “Among those with a bachelor’s degree or better, only 3.2 percent are unemployed.”
Before rushing to any conclusion about the economy, Americans should know that November’s job growth is an outlier, said the Wall Stree Journal. The unusually large jump was unprecedented. Therefore it’s too soon to point to widespread economic expansion.
To achieve that, “America doesn’t just need one month like November. We need many more months like it,” said the Huffington Post.
The president is optimistic. He is predicting more outlier months and that the recovery will eventually trickle down to wage increases.
“We’re going to keep at (fixing the economy) until every single American who is willing and able to work can find not just any job but a job that pays a decent wage and allows them to support their families,” said Obama on Friday.
But an improved labor market and growing economy may have a slightly negative consequence for borrowers, reported Reuters: Sooner-than-anticipated interest rate increases before the predicted mid-2015 date.
dsutton@deseretnews.com | Twitter: @debylene
