Economy Watch: November Job Gains, Long-Term Unemployment
- Dec 08, 2014
The November jobs report released by the Bureau of Labor Statistics on Friday, widely acknowledged as a very strong one, detailed increasing in hiring across various sectors of the economy. For instance, profession and business services jobs gained a net of 86,000 positions for the month, compared with an average increase of 57,000 a month over the last 12 months. Employment in retail trade rose by 50,000 in November, compared with an average gain of 22,000 per month in the last year.
Healthcare, usually a strong sector of the economy, didn’t disappoint in November, adding 29,000 jobs for the month, and manufacturing did nearly as well, with an addition of 28,000 jobs. Financial services companies added a net of 20,000 positions, and transportation and warehousing employment was up by 17,000.
All together, the U.S. economy has created more than 2.75 million jobs in the last 12 months, counting November’s addition, as well as upward revisions to October and September. This calendar year is thus on track to be the strongest one for employment not only since before the recession, but since the late 1990s.
Long-Term Unemployment Still Problematic
Still, marginal attachment to the labor force and long-term unemployment are proving to be hard nuts to crack, according to the BLS. In November, 2.1 million people were marginally attached to the labor force, essentially unchanged from a year earlier. These are people who weren’t in the labor force, but wanted and were available for work, and had looked for a job sometime in the previous 12 months. They weren’t counted as unemployed because they had not searched for work in the four weeks preceding the survey.
Among the marginally attached, there were 698,000 discouraged workers in November, little different from a year earlier. Discouraged workers are those who aren’t currently looking for work because they believe no jobs are available for them. The remaining 1.4 million persons marginally attached to the labor force in November had not searched for work for reasons such as school attendance or family responsibilities.
The BLS’ broadest labor underutilization metric, U-6, dropped from 11.5 percent in October to 11.4 percent in November, its lowest rate since before the recession. The U-6 includes not only the headline unemployed, but also people marginally attached to the labor force, plus total employed part time for economic reasons (those who want a full-time jobs, but who can only find a part-time one).
Wall Street had a positive reaction to the jobs numbers on Friday, with the Dow Jones Industrial Average gaining 58.69 points, or 0.33 percent. The S&P 500 advanced 0.17 percent and the Nasdaq was up 0.24 percent.