U.S. employers added 112,000 workers
in November, fewer than even the lowest forecast and a sign that
increased costs for oil and raw materials made companies
reluctant to hire.
The jobless rate dropped to 5.4 percent from 5.5 percent,
the Labor Department said Friday in Washington. Job growth in the
prior two months was revised down by 54,000. Factory jobs fell
for a third month and retail employment declined.
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Workers earned a penny more an hour than a month earlier,
the smallest increase this year, at a time when they’re paying
more for fuel. Tepid wage growth underscores the difficulty
retailers such as Wal-Mart Stores Inc. are having boosting
holiday sales, and may restrain consumer spending and the economy
in coming months.
“This throws cold water on the idea that the labor market
has fully recovered,” said Michael Moran, chief economist at
Daiwa Securities America Inc. in New York. “With the job market
still lacking vigor, we’re probably not going to see rapid growth
in consumer spending.”
Treasury securities rose the most in four months, and the
dollar declined as the report eased concerns the Federal Reserve
would accelerate the pace of interest-rate increases. Central
bankers meet Dec. 14 and are forecast to boost the benchmark
overnight bank lending rate one-quarter percentage point to 2.25
percent to keep a lid on inflation. It would be the fifth
increase in as many meetings.
The Fed should continue to raise interest rates “at a
measured pace” next year as the economy expands at close to a 4
percent rate, creating “solid but moderate gains in employment”
Philadelphia Federal Reserve President Anthony Santomero said
Friday in a speech in Philadelphia.
The Institute for Supply Management said Friday that its
index of services and other non-manufacturing business
unexpectedly rose to 61.3 in November from 59.8. Readings above
50 signal expansion.
“This is a pattern I think we should get comfortable with,
which is a slow move ahead, a little choppiness month to month as
companies continue to adjust themselves on the labor front,”
said Jeffrey Joerres, chief executive of Manpower Inc., the
world’s second-largest temporary staffing company, in a televised
interview.
“What we are seeing is a market that is much more measured
and is clawing its way back up the hill in the labor market, not
bounding,” said Joerres.
Bloomberg News
