While job growth didn’t meet expectations in November, the unemployment rate fell to its lowest level since February 2020, according to the latest data from the U.S. Bureau of Labor Statistics.
“The unemployment rate continued to plunge and is now at 4.2%, which is actually below March 2020 levels when the ugly COVID virus came to the country. This measurement should be taken with a grain of salt, however, since many Americans are not showing up in the statistics. Only those who are searching for a job are counted,” said Dr. Lawrence Yun, National Association of REALTORS® chief economist, in a statement. “A better measure of employment conditions is the total number of people with jobs. Only 210,000 payroll jobs were added in November, and we are still down by 3.9 million from the peak seen before the pandemic. Moreover, based on normal population growth and young adults entering the workforce each year in a hypothetical world where the pandemic did not happen, America should have around 8 million more jobs now compared to the current situation. The hourly wage grew by 4.8%, a tad lower than the consumer price inflation rate.”
Total nonfarm payroll employment increased by 210,000 and the unemployment rate
fell by 0.4 percentage point to 4.2%. The most notable job gains occurred in professional and business services, transportation and warehousing, manufacturing and construction—the latter of which is an area that sorely needs to boost production.
The construction industry added 31,000 jobs in November, following similar increases over the past two months, but it is still 115,000 below February 2020 levels. Specialty trade contractors added 13,000 jobs, while construction of buildings added 10,000, and heavy and civil engineering construction added 8,000.
“The construction of buildings and the trade sector added 23,000 jobs, implying that a supply of more homes is in the pipeline. Rental and leasing service jobs fell by 1,400, even though rental demand has picked up sizably,” added Yun. “REALTOR® membership is at an all-time high and continues to rise. In fact, the overall number of small businesses, which are less trackable in the early stage of data collection, could be rising. That is, more Americans want to be entrepreneurs as 1.1 million reported having a new job, which is much higher than the 210,000 as reported by company payroll data.”
Mortgage Bankers Association SVP and Chief Economist Mike Fratantoni said that any way you look at it, the job market is continuing to improve.
“The headline nonfarm payroll gain of 210,000 jobs in November was smaller than anticipated. However, as has been the case several times this year, there are reasons to believe that this understates the improvement,” he said in a statement. “Almost 6 million more people are employed compared to last November. There was an almost 800,000 monthly increase on an unadjusted basis, and the seasonal adjustment factors are less reliable given the volatility during the pandemic. Finally, the employment gauge from the household survey was up 1.1 million over the month.”
