Job growth weak for November in setback for economy
Saturday, December 4, 2010
The nation added only a trickle of jobs in November, far fewer than experts had expected and a reminder that the economy is still recovering only fitfully.
The job market was weak all around: Stores, factories, construction companies and financial firms all cut positions. The unemployment rate nudged closer to double digits again — 9.8 percent, after three straight months at 9.6 percent.
Employers added 39,000 jobs for the month, the Labor Department said Friday. They added 172,000 in October — enough to qualify as a hiring spurt in this anemic post-recession economy.
“Just when it was safe to believe the labor market was firming and job growth was coming back, we were reminded that this recovery is proceeding with fits and starts,” said Joel Naroff, president of Naroff Economic Advisors.
The report caught economists off guard. They had predicted 150,000 new jobs, based on a raft of recent positive reports that showed busier factories, rising auto sales and a healthy start to the holiday shopping season.
The stock market seemed to take the bad news in stride. The Dow Jones industrial average closed up about 20 points at 11,382, not far from its postrecession high.
The November jobs report may prove to be just a temporary setback because economic recoveries are often bumpy. But for now, hiring is so weak that the economy isn’t creating even enough jobs to keep up with the growth in the work force.
It takes about 125,000 new jobs a month to do that and keep the unemployment rate stable. Economists say it would take up to 300,000 new jobs a month to reduce the unemployment rate significantly.
“It will be a long haul back to normalcy,” said Ian Shepherdson, chief U.S. economist at High Frequency Economics.
The rate, now at a seven-month high, has exceeded 9 percent for 19 straight months, the longest stretch on record. It could pass 10 percent, as it did briefly in late 2009, again next year.