U.S. employment growth slowed sharply in November

The sharp slowdown in US employment growth last month has raised questions about whether the Fed will take a more aggressive approach to curtailing its stimulus plan.

Employers in the world’s largest economy added only 210,000 jobs this month, a sharp drop from the previous 546,000 Position It was created in October, well below the 550,000 predicted by economists. Since the beginning of this year, the average monthly income has been 555,000.

The unemployment rate fell by 0.4 percentage points to 4.2%. Less than six months ago, it hovered at a level of close to 6%.

But data released by the US Bureau of Labor Statistics on Friday showed that the number of people employed or looking for a job only slightly improved.

The so-called labor force participation rate has been stagnant since June 2020, rising from 61.6% in October to 61.8% in November, but it is still about 1.5 percentage points lower than the pre-pandemic threshold.

Childcare issues and Covid-related concerns are one of the most frequently cited reasons preventing people from returning to work-this dynamic may be affected by recent new developments. Omi Kron Coronavirus variants.

Loretta Mester, President of the Federal Reserve Bank of Cleveland, warn This risk was discussed in an interview with the Financial Times on Thursday.The Chairman of the U.S. Central Bank, Jay Powell, also mentioned this in his two-day congressional testimony earlier this week, noting that another wave of Covid-19 may hinder the progress of the labor market and deteriorate. supply chain Interrupted.

He said that this may mean slower employment growth, slower economic activity, and greater uncertainty about inflation, which is running at the fastest rate in 30 years.

With a severe labor shortage, employers have had to raise wages to attract workers, and the average hourly wage increased again in November.

Wages rose by 0.3% month-on-month, bringing the annual growth rate of wages to 4.8%.

The latest employment report shows that 3.9 million Americans are still unemployed compared to before the pandemic say clearly The central bank is taking a more active stance to combat inflation, and he acknowledged that inflation has expanded throughout the economy in recent months and has triggered the specter of a more persistent problem.

Powell hinted this week that he might support Accelerating The central bank withdrew from its huge stimulus program-a process that began only a few weeks ago, and its pace will completely end bond purchases in June.

Many Fed officials this week expressed public support for a faster exit, which may mean raising interest rates earlier than expected. This possibility shook financial markets and prompted economists to increase their bets on raising interest rates next year.

Some Wall Street analysts now expect to raise interest rates three times next year, and the first adjustment will take place as early as May.

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