Economy adds just 210,000 jobs in November even as COVID cases fall, schools reopen; unemployment drops to 4.2%




  • In Business
  • 2021-12-03 18:15:42Z
  • By USA TODAY

Hiring slowed sharply in November despite falling COVID-19 cases, easing child care constraints and expiring unemployment benefits, developments that appeared to draw more Americans back into the workforce.

The economy added 210,000 jobs, and the unemployment rate, which is calculated from a different survey, fell from 4.6% to 4.2%, the Labor Department said Friday.

Economists had estimated that 545,000 jobs were added last month, according to a Bloomberg survey.

The disappointing job gain doesn't reflect last week's discovery of COVID's omicron variant in South Africa, which happened too late in the month to affect the employment survey.

The U.S. has recovered 18.4 million, or 82%, of the 22.4 million jobs lost during the depths of the pandemic in the spring of 2020. That leaves the nation about 4 million jobs below its pre-crisis level.

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In an interview, Labor Secretary Marty Walsh focused on the bigger picture.

"Unemployment has dropped a full 2 percentage points since President Biden took office" and nearly 6 million jobs have been created in that period.

"We're looking at the sharpest one-year decline in unemployment ever," Biden told reporters. "America is back to work and our jobs recovery is going very strong."

Leisure and hospitality, which includes restaurants and bars, was hit hardest by the pandemic and has been driving strong payroll gains for many months but added just 23,000 last month.

And retail shed 20,000 jobs after seasonal adjustments that reflect the outsize gains the industry typically notches in November amid holiday hiring.

Other sectors recorded healthy advances. Professional and business services added 90,000 jobs; transportation and warehousing, 50,000; and construction and manufacturing each added 31,000.

There were other positive signs in the report. Payroll gains for September and October were revised up by a total 82,000 and averaged 462,000 for the two months. Big upward revisions to employment totals this year indicate that November's disappointing figure could be moved higher, says economist Gus Faucher of PNC Financial Services Group.

And the labor force -- made up of Americans working or looking for jobs -- grew by nearly 600,000, highlighting that many people on the sidelines are streaming back into an improving job market that's offering higher wages. The share of people over 16 participating in the labor force rose from 61.6% to 61.8%.

That could help ease dire worker shortages.

Employer demand for workers has been strong for months but the labor shortages have held job gains to solid but less-than-blockbuster levels. In September, COVID's delta variant kept many Americans cautious and many schools from fully reopening, forcing parents to care for distance learning kids and put off their return to the workplace or job hunts.

But 81% of Americans over 12 are now fully vaccinated and some children age 5 to 11 also have gotten their first shots, according to the Centers for Disease Control and Prevention. New daily COVID cases have fallen from about 95,000 to 82,000 the past 10 days and from 150,000 since early September. Schools, meanwhile, largely have reopened.

And three months have now passed since the federal government's enhanced unemployment benefits expired for about 11 million people. As a result, while the share of Americans working or looking for jobs didn't tick up as expected in September and October, some economists say November's solid labor force gain could foreshadow further advances in coming months.

"This looks weaker than expectations on the surface, but, all told, it's a pretty solid report," says Brian Coulton, chief economist of Fitch Ratings.

Economist Andrew Hunter of Capital Economics says the mixed report won't stop the Federal Reserve from accelerating a winding down of its bond-buying stimulus this month in a bid to clear the way for earlier interest rate hikes next year to curtail an inflation spike.

A man in a face mask walks past a \"Now Hiring\" sign in Arlington, Virginia.
A man in a face mask walks past a \"Now Hiring\" sign in Arlington, Virginia.  

A couple of wild cards, though, could darken the job market, including COVID's omicron variant.

And President Biden's mandate of employee vaccinations or testing for companies with more than 100 employees will take effect January 4, possibly leading some workers to quit, Hunter says.

Economist Lydia Boussour of Capital Economics says she expects U.S. payrolls to reclaim their pre-COVID level by the second half of next year.

But, she adds, "The path forward could prove bumpier than anticipated."

Jane Oates, president of WorkingNation, a nonprofit that raises awareness about the challenges facing U.S. workers and a former Labor official overseeing training, says she's concerned that the share of prime-age workers (25-54) working or looking for jobs is still just 81.8%, compared to 82.9% before the pandemic. The share, though, has edged up from 81.6% since September.

There were some signs that hiring might have softened in November. Homebase, which supplies payroll software to small firms, said the number of employees working at the firms declined by 2.7% last month.

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Contributing: Courtney Subramanian and Maureen Groppe

This article originally appeared on USA TODAY: Jobs report shows 210,000 jobs added as hiring slowed in November

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