The U.S. economy generated another month of solid hiring in November, making it highly likely that the Federal Reserve will raise interest rates from record lows this month, The Associated Press reports.
The Labor Department announced this morning that employers added 211,000 jobs, led by big gains in construction and retail. And the government revised up its estimated job growth for September and October by a combined 35,000. The unemployment rate remained a low 5% for a second straight month. More Americans began looking for jobs in November, and most found them.
Employers have now added an average 213,000 jobs a month over the past six months. The robust hiring indicates that consumer spending is powering the economy even as weak growth overseas and low oil prices squeeze U.S. manufacturers and drillers.
Fed Chair Janet Yellen said this week that the economy appeared to be improving enough to justify a rate hike as long as no major shocks undermine confidence before the Fed meets Dec. 15-16. The Fed has kept its key short-term rate at a record low near zero for seven years.
For the Fed, conditions seem nearly ideal for a period of small and only gradual rate increases in coming months: Job growth has been consistently solid, and wages have begun to rise but not so much as to cause concern about future high inflation.
The November jobs report shows that the U.S. economy “is strong enough to withstand an initial hike in interest rates from what were seen as emergency record-low levels,” says Chris Williamson, chief economist at Markit. “A December rate hike now looks to be in the bag.”
Job gains were broad-based across the economy in November. Construction companies added 46,000 jobs, the most in two years. Spending in that sector has reached its highest level in eight years, boosted by more homebuilding and development of more roads and infrastructure. Government added 14,000 positions in November, retailers nearly 31,000. But factories shed 1,000 jobs.
