Dec 5, 2014 11:30 AM
US adds 321,000 jobs, the most in nearly 3 years
The Associated Press
WASHINGTON (AP) A burst of U.S. hiring in November the most in nearly three years added 321,000 jobs and provided the latest evidence that the United States is outperforming other economies throughout the developed world.
In addition, the government said Friday that 44,000 more jobs were added in September and October combined than it had previously estimated. So far this year, job gains have averaged 241,000 a month, putting 2014 on track to be the strongest year for hiring since 1999.
The unemployment rate remained at a six-year low of 5.8 percent.
"These were boom-like numbers," said Mark Zandi, chief economist at Moody's Analytics. "They indicate that the U.S. economy is on very solid ground."
November's robust job growth, reflecting a steadily rising economy, could make it likelier that the Federal Reserve will start raising interest rates by mid-2015 as many economists have speculated. The Fed has kept its key short-term rate at a record low near zero since 2008 to support the economy.
The job gains last month coincided with a sharp increase in workers' pay. The average hourly wage rose 9 cents to $24.66, the biggest gain in 17 months. Still, over the past 12 months, hourly pay has risen just 2.1 percent, barely above the 1.7 percent inflation rate.
Hiring last month was broad-based but particularly concentrated in retail, temporary services and transportation and warehousing. Those increases likely reflect seasonal hiring for the holiday season. Shipping companies have announced ambitious plans: UPS has said it expects to add up to 95,000 seasonal workers, up from 85,000 last year. FedEx plans to hire 50,000, up from 40,000.
In addition, manufacturers added 28,000 jobs in November, the most in a year, and education and health services 38,000. Professional and business services, a category that includes generally low-paid temps but also higher-paying jobs in fields such as accounting and engineering, added the most jobs in four years.
The surge in hiring comes after the economy expanded from April through September at its fastest six-month pace in 11 years. The additional jobs should support steady economic growth in coming months.
The U.S. recovery still has far to go to fully rebound from the Great Recession, given that many people without jobs have stopped looking for one and are no longer counted as unemployed and many others have received little or no pay increases.
"At this rate, we won't return to pre-recession labor market health until October 2016 nearly nine years since the recession began," said Elise Gould, a senior economist at the liberal Economic Policy Institute.
Even so, the improving U.S. job market contrasts with weakness elsewhere around the globe. Growth among the 18 European nations in the euro alliance is barely positive, and the eurozone's unemployment rate is 11.5 percent. Japan is in recession.
China's growth has slowed as it seeks to rein in excessive lending tied to real estate development. Other large developing countries, including Russia and Brazil, are also straining to grow.
Most economists say the United States will likely continue to strengthen despite the sluggishness overseas. The U.S. economy is much less dependent on exports than are Germany, China and Japan. U.S. growth is fueled more by its large domestic market and free-spending consumers, who account for about 70 percent of the economy.
That trend helps support the steady U.S. job growth. Most of the industries that have enjoyed the strongest job gains depend on the U.S. market rather than on overseas demand. Retailers, restaurants and hotels, and education and health care, for example, have been among the most consistent sources of healthy hiring since the recession officially ended in 2009.
Seva, a chain of fast-casual spas located mainly inside Wal-Mart stores, has been adding jobs all year while expanding from about 75 to 100 sites. It plans to open more free-standing spas in Georgia and Illinois next year.
CEO Vas Maniatis says its customers have been willing to spend more this year on higher-priced services such as body waxing and facials, which have boosted revenue. Just after the recession, the company had focused more on lower-priced procedures such as eye brow shaping.
"People want the services," he said. "They are willing to spend more money and are spending more in our stores."
Most recent figures on the economy have been encouraging. Americans are buying more cars, which will likely keep factories busy in coming months. Auto sales last month rose to their second-fastest pace this year. Car sales are on track to rise 6 percent this year from 2013.
And a survey by the Institute for Supply Management, a trade group of purchasing managers, showed that services firms expanded at nearly the fastest pace in eight years last month. The ISM's separate survey of manufacturing firms showed that factories are expanding at a brisk pace.
There have been some signs of moderating growth. Consumer spending rose only modestly in October. And businesses ordered fewer big-ticket manufactured goods that month, excluding the volatile aircraft category. That indicates that companies are holding back on investment.
AP Economics Writer Josh Boak contributed to this report.