Analysis:
- The U.S. economy added 266,000 jobs in November, exceeding market expectations of approximately 187,000 jobs.
- Job gains for September and October were revised upward a combined 41,000 jobs.
- This indicates continued strength in the U.S. labor market.
Economist Corner:
The labor market continues to boom. A rising tide may lift all boats, but some rise more than others: a “hot” jobs market like this one tends to disproportionately benefit minorities. Incomes for minorities are therefore likely to grow disproportionately, a trend that would likely put downward pressure on income inequality by raising incomes towards the bottom.
This jobs number also calls into question a set of consensus expectations that continues to anticipate slowdowns in the labor market and in GDP growth. Job growth in the U.S. is continuing, even accelerating, as unemployment remains below what economist call its “natural” rate.
A few countries, like Australia, have experienced decades of growth without a recession. The economics profession lacks any consensus explanation for why or how. Meanwhile, the latest data release exhibits no signs of unemployment rising towards its “natural” rate. Yet many who analyze the U.S. economy continue to wonder when next its recession will strike.
This jobs report raises the specter not of recession, but of whether economists may one day ask whether the U.S. has joined Australia in developing an “unnatural” immunity to recessions.