5 Things to Watch in the November Jobs Report

The Labor Department releases its broadest gauge of the jobs market on Friday. Economists surveyed by The Wall Street Journal expect the November jobs report to show employers added 198,000 jobs during the month and unemployment held at 3.7%. Here are five things to watch in the report.

1. Hot Hiring

U.S. employers have added better than 200,000 jobs to payrolls in four of the past six months, data that point to businesses remaining optimistic about the economy. A similar gain in November would cause this year to surpass 2017 in terms of job growth, and nearly match 2016 with a month still to go. That would be notable because economists expected hiring to slow as the labor market tightened and fewer workers were available.

2. Falling Further?

The unemployment rate held at a 49-year low the past two months. If the rate were to fall further, that could give Federal Reserve policy makers something to think about. The rate last month was already where Fed officials expected it to finish the year. Very low unemployment would seem to give the central bank leeway to continue its gradual path of interest rate increases. But softening inflation, a jittery stock market and concerns over global growth could cause some policy makers to consider pausing increases after an expected bump later this month.

3. Paying Off

Hourly wages rose 3.1% in October from a year earlier, the best annual growth rate since the recession ended in 2009. Economists expect a further acceleration, projecting wages advanced 0.3% on the month in November and 3.2% from a year earlier. Wages had grown at a sluggish rate during most of the expansion. Better average growth this year suggests a broader swath of the workforce is benefiting from low unemployment rates.

4. Points for Participation

Low unemployment and rising wages should entice more Americans into the labor force. And that’s been true for those in their prime working years, between 25 and 54 years old. The labor-force-participation rate for that group rose to 82.3% in October. That was the best reading since 2010 and up significantly from a recent low of 80.6% in September 2015. Watch to see if more workers arrived in November. The trend is less convincing among all Americans. Last month’s rate of 62.9% is only modestly higher than 62.3% in September 2015. That likely reflects baby boomers retiring in greater numbers.

5. Don’t Stay in School?

The labor market this year is the best on record for high-school dropouts. The unemployment rate for those older than 25 who do not have a high-school diploma has averaged 5.6% through the first 10 months of this year. That’s significant because the jobless rate for dropouts is trending below the 70-year average unemployment rate for all Americans. That rate for non-diploma-holders had never before done better than match the long-run average, in data back to 1992. Watch Friday’s jobs report to see how the trend played out in November.

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from Real Time Economics https://ift.tt/2SzigA7