Payrolls and wages blow past expectations, flying in the face of Fed rate hikes
Source: CNBC
Job growth was much better than expected in November despite the Federal Reserve’s aggressive efforts to slow the labor market and tackle inflation. Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%, the Labor Department reported Friday.
Economists surveyed by Dow Jones had been looking for an increase of 200,000 on the payrolls number and 3.7% for the jobless rate. The monthly gain was a slight decrease from October’s upwardly revised 284,000. A broader measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons edged lower to 6.7%.
The numbers likely will do little to slow a Fed that has been raising interest rates steadily this year to bring down inflation still running near its highest level in more than 40 years. The rate increases have brought the Fed’s benchmark overnight borrowing rate to a target range of 3.75%-4%.
In another blow to the Fed’s anti-inflation efforts, average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis, also well above the 4.6% expectation.
Read more: https://www.cnbc.com/2022/12/02/jobs-report-november-2022.html
From the source -
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Payroll employment increases by 263,000 in November; unemployment rate unchanged at 3.7% https://bls.gov/news.release/empsit.nr0.htm
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8:30 AM · Dec 2, 2022
I knew this would happen. Swing and whooosh!
Happy Friday and please stay tuned for our DU economic analysts to chime in.
Article updated.
Previous articles and/or headlines -
Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%, the Labor Department reported Friday. Economists surveyed by Dow Jones had been looking for an increase of 200,000 on the payrolls number and 3.7% for the jobless rate. The monthly gain was a slight decrease from October's upwardly revised 284,000.
The numbers likely will do little to slow a Fed that has been raising interest rates steadily this year to bring down inflation still running near its highest level in more than 40 years.
In another blow to the Fed's anti-inflation efforts, average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis, also well above the 4.6% expectation.
Job growth was better than expected in November despite the Federal Reserve's aggressive efforts to slow the labor market and tackle inflation.
Nonfarm payrolls increased 263,000 for the month while the unemployment rate was 3.7%, the Labor Department reported Friday. Economists surveyed by Dow Jones had been looking for an increase of 200,000 on the payrolls number and 3.7% for the jobless rate.
This is breaking news. Please check back here for updates.
Original article -
This is breaking news. Please check back here for update
= new reply since forum marked as read
and I had her, CNBC, and WaPo up, refreshing all 3 of them starting at 8:30 am.
CNBC won the race with a headline that had the release numbers at 8:31 am despite the 200,000 estimate still in their original story content when they updated their headline.
using the terminology based on an at least 20% change in value... So not saying "all markets" but in this case, just that index and based on 2 intra-year points in time.
E.g., -
By Jess Menton
November 30, 2022 at 3:40 PM EST Updated on November 30, 2022 at 4:33 PM EST
US stocks surged on Wednesday, putting the blue-chip Dow Jones Industrial Average more than 20% above its September low after Federal Reserve Chair Jerome Powell’s dovish comments and signs of cooling US inflation raised hopes that the central bank will become less aggressive on interest-rates hikes.
The surge in the oldest of Wall Street’s three main stock indexes meets what some investors define as a bull market. Though analysts don’t always share the same definition for when to call the end of a bear market, which they say can only be recognized in hindsight.
While the Dow slumped into a bear market in September -- the index’s first bear market since the pandemic-fueled selloff in early 2020 -- it has been on a tear since October, boosted by the prospect of a slower pace of rate increases and the latest batch of corporate earnings. Just last month, the Dow rallied 14% to notch its biggest monthly gain since January 1976.
Of course, the Dow, with only 30 large-cap companies, is a much narrower index than the S&P 500 Index or the Nasdaq 100 Index, which both have been weighed down by weakness in mega-cap growth shares. While the Dow, with only 30 large-cap companies, is a much narrower index than the S&P 500 Index or the Nasdaq 100 Index, and was the last of the gauges to enter a bear market this year.
(snip)
https://www.bloomberg.com/news/articles/2022-11-30/dow-climbs-20-from-low-as-stocks-rally-and-inflation-fears-ebb-lb443vym
The "grain of salt" note came here -
Last Updated: Nov. 30, 2022 at 4:38 p.m. ET
First Published: Nov. 25, 2022 at 1:39 p.m. ET
After outperforming both the S&P 500 and Nasdaq Composite in November, the Dow Jones Industrial Average has exited bear-market territory, based on oft-cited criteria, on the final trading day of the month. But before investors get too excited about a new bull market for equities, there’s plenty of reason for caution.
The Dow DJIA, +0.10% finished Wednesday’s session at its highest closing level since April 21, according to Dow Jones Market Data. Thanks to the gains spurred by Fed Chairman Jerome Powell’s comments at the Brookings Institution, the blue-chip gain has now risen 20.4% from its Sept. 30 closing low, meaning it has technically exited bear-market territory. It’s the only major equity index to do so.
Typically, when a given index or asset has risen 20% or more off a recent bear-market low, it is said to have technically exited bear-market territory. Throughout the history of financial markets, there have been many examples where stocks have rallied during a bear market, only to eventually turn lower and erase all of those gains.
During drawn-out recessionary bear markets, stocks often rip higher, only to see their gains fizzle again and again. This has already happened more than three times since the start of 2022, including notable counter-rallies that occurred in March, in July and August, and again since mid-October, according to FactSet data.
(snip)
https://www.marketwatch.com/story/dow-finishes-at-highest-level-since-april-as-blue-chip-gauge-nears-bear-market-exit-heres-why-investors-should-take-this-with-a-grain-of-salt-11669401558
So the caveat is that it could just be a partly illusionary based on "technical definitions" (like technical definitions of "recessions" as being at least 2 successive quarters with a negative GDP, etc.).
Stock Market Watch (it's a 6 month graph, starting in early June)
and I keep warning that, despite appearances, stock markets haven't recovered and the S&P 500 is still down ___% (currently 15.1% down from its Jan 2 all-time closing high 
)
Then, separately, I keep reading in DU how we can't possibly be in a recession when the unemployment rate is so low, it has never happened.
Au contraire, per the NBER ( http://www.nber.org/cycles/recessions_faq.html ), recessions (contractions) begin at the peak of the economy and end at the trough (bottom) of the economy. And expansions (recoveries) begin at the trough of the economy and end at the peak of the economy.
Anyway, its a hindsight sort of thing to determine when a recession begins. Obviously the indicators they use will have to fall a lot further than they are now before they say there is (or has been) a recession.
like what happened at the beginning of the pandemic with literal business shutdowns and a complete global supply chain disruption that effectively killed GDP, recessions are usually confirmed probably a year or so after the fact (which also accounts for any data revisions to nail things down). I know there are different "definitions" of "recession" and what is going on now goes back to that "pandemic shock" that I post about often, and we are probably have to wait until much later in the future to really gauge what this odd situation has done.
And I do agree with the caution in the 2nd article I posted because many times we have seen these rallies "vanish" with some "bad news". I think that much of what might be going on the Dow are institutional funds moves (and it also makes me wonder if some are even people who had started cashing out of crypto as it was collapsing and who have been throwing that money into something "simple", with only 30 choices of things to buy ).
(from here - https://www.nytimes.com/2022/11/10/business/economy/october-inflation-data.html?smid=url-share)
I'll also put up the updated version of where they stand with the rates -
(from here - https://www.macrotrends.net/2015/fed-funds-rate-historical-chart)
Still nowhere near the worst of the past.
I'm wondering how Powell feels about that. A big goal of his from what I've read is that he wants to get the job openings to job seekers ratio down.
Nationally, the labor force participation rate has been dwindling from a high point of about 67.3% in 2000 to 62.1% now. (It was 62.2% in January, so there hasn't been any progress in that all year).
Meanwhile the population of elderly (such as me) needing more and more service (me not yet but soon) grows.
Labor force participation rate: http://data.bls.gov/timeseries/LNS11300000
Labor force in thousands: http://data.bls.gov/timeseries/LNS11000000
(the graph is through November 2022)
The labor force = employed + officially unemployed as per the BLS's monthly Household Survey
The officially unemployed are jobless people who have looked for work in the past 4 weeks (must be more than just looking at job listings). BTW, the officially unemployed is not a count of people claiming unemployment insurance, it has nothing to do with that (a common myth unfortunately).
How the Government Measures Unemployment http://www.bls.gov/cps/cps_htgm.htm
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I've had my bus service cut and cut and cut again, due to a shortage of drivers. On December 3, a big cut reducing service by 8% takes effect. Healthcare workers, elderly care and child care are some other areas suffering the most severe shortages.
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Edited to add: We had quite a discussion about the Labor Force Participation Rate last month:
https://www.democraticunderground.com/10142990161
