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Non-farm payrolls only increased by 245,000 in November, well below Wall Street estimates, as the rise in coronavirus cases coincided with a significant slowdown in hiring.
Economists polled by Dow Jones were looking for 440,000 and the unemployment rate at 6.7% against 6.9% in October. The unemployment rate has lived up to expectations, although it has declined alongside a drop in the labor force participation rate to 61.5%. A more comprehensive measure of unemployment fell slightly to 12%.
November’s gain represented a steep slowdown from the 610,000 positions added in November.
The numbers come amid a new wave of coronavirus cases that threaten to push America’s health care system to the brink of collapse. More than 100,000 people are hospitalized across the United States due to the accelerated epidemic, which recorded 210,161 new cases on Thursday, according to the Covid Tracking Project overseen by reporters from The Atlantic.
Although the United States is emerging from its fastest growing quarter of all time, economists fear the next quarter or two will see stable or even negative growth before rebounding sharply at the end of 2021.
November’s job gains would be considered strong under normal circumstances, but the pandemic has left millions of Americans out of work because of jobs lost at the start of the crisis. The total represents the slowest job growth since the employment recovery started in May.
“Overall, this is a disappointing report,” Jefferies economists said in a note. “With the upsurge in COVID cases and policies put in place to try to slow the spread, hiring has slowed. Additionally, the availability of workers is also a major limiting factor, with many of them unable to go to work due to COVID issues or family care obligations. “
Despite the disappointing number, the markets showed little reaction, with Wall Street expecting a higher open.
The job gains came from transportation and warehousing, which increased by 145,000 thanks to an increase in couriers and messengers as well as warehousing and storage.
Professional and business services added 60,000 and health care 46,000. The struggling hotel industry, which suffered the worst job losses during the pandemic, only increased by 31,000 jobs, while the retail industry lost 35,000 jobs, a potentially worrying sign as the holiday shopping season approaches.
General merchandise stores fell by 21,000, while sporting goods, hobby, book and music stores fell by 12,000. Electronics and home appliance stores fell by 11,000 , while health and personal care stores were down 8,000.
Overall, the retail industry lost 550,000 workers from February, the month before the pandemic restrictions were put in place.
Construction and manufacturing each created 27,000 jobs for the month, while financial activities increased by 15,000.
Government hiring fell for the third consecutive month, down 99,000 mainly due to the loss of census workers hired for the 2020 enumeration.
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