The US labor market added 64,000 jobs in November, exceeding economist expectations of around 40,000 positions, according to employment data released on Tuesday. October figures showed a decline of 105,000 jobs. The November gains partially offset losses sustained during the federal government shutdown, though broader economic indicators suggest ongoing weakness.
Despite the stronger-than-expected November employment gains, the unemployment rate continued its upward trajectory, reaching 4.6% in November, marking the highest level in four years. Federal government employment declined significantly, dropping 162,000 positions in October and 6,000 in November. Previous estimates for August and September job growth were also revised downward, with August revised from a loss of 4,000 to a loss of 26,000, and September revised from growth of 119,000 to 108,000.
Federal Reserve Chair Jerome Powell cautioned that the employment data should be viewed with skepticism, noting that actual job losses may be understated in official reports. Powell suggested there may be an overcount in payroll job numbers of roughly 60,000 monthly that will eventually be corrected, though he acknowledged uncertainty around the exact timing and magnitude. He attributed some labor market softness to immigration policy effects on labor supply. Private sector employment data from ADP showed 32,000 jobs shed in November following gains of 47,000 in October, adding to concerns about labor market trajectory.
The release of employment data was delayed due to a 43-day federal government shutdown that disrupted normal data collection processes. The Bureau of Labor Statistics did not release complete October employment figures and delayed November data release. Powell warned that data quality issues stemming from the shutdown would require careful scrutiny through the January policy meeting. Separately, the BLS has faced leadership challenges, with proposed staffing reductions of approximately 207 employees between fiscal year 2024 and fiscal year 2026, representing a 20% decline in total staff.
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