Markets

November Jobs Growth Slows More Than Expected as Permanent Layoffs 'Remain Stubbornly High'

11:18AM ET 12/04/2020 MT Newswires
Payroll employment growth slowed more than expected in November as the labor market in the world's top economy continued its bumpy recovery from the COVID-19 pandemic.

Non-farm payrolls rose by 245,000 last month, the Bureau of Labor Statistics said on Friday. That was well under the Econoday consensus for 500,000. The October print was revised lower to 610,000 from an earlier estimate of 638,000. The employment rate slipped 0.2 percentage point to 6.7%, better than the Street's view for 6.8%.

"More workers are moving into the long-term unemployed zone, and the number of people on permanent layoff remained stubbornly high," said Clarie Fan, economist at RBC Economics. "And in the week ending Nov. 14, there were still more [than] 20 million people claiming some form of unemployment insurance benefits (including the self-employed) from all state and federal programs."

Professional and business services employment rose 60,000 in November, driven by temporary help services hiring. Health care added 46,000 jobs while government employment fell by 99,000, with much of the loss coming from the loss of temporary workers hired for the 2020 Census.

Average hourly earnings rose by $0.09 to $29.58 while the average workweek remained at 34.8, the BLS said.

"Job growth has slowed markedly, and this report demonstrates yet again that it's not possible to separate the economy from the virus," said Ian Shepherson, chief economist at Pantheon Macroeconomics. "We hope these numbers will increase the pressure on Congress to act, though nothing they can do will affect December payrolls."

COVID-19 cases have surged in recent weeks, driving state and local governments to impose restrictions in several regions around the country.

In recent days, a new $908 billion bipartisan pandemic-relief proposal has been discussed by Democratic and Republican congressional leaders. Senate Majority Leader Mitch McConnell and House Speaker Nancy Pelosi discussed the proposal during a call on Thursday.

McConnell told reporters after the talks that he and Pelosi are "both interested in getting an outcome" on the proposal as well as a government spending plan that needs to be passed by Dec. 11.

"This jobs report is blaring warning that a double-dip recession is looming and must be a wakeup call for anyone who is standing in the way of true bipartisan emergency relief," CNBC quoted Senate Minority Leader Chuck Schumer as saying in a statement.