If any doubts remained over whether or not the Federal Reserve would raise interest rates when they gather later this month, they’ve been put to rest.
The government released its most recent jobs report on Friday, Dec. 4, and with American businesses bolstering their payrolls at a potent pace in November, an interest rate hike is all but assured. Jobs growth beat median forecasts. Newly added wealth management and insurance jobs meant that finance industry employment improved from the month before.
Employment rate proves robust
Heavy anticipation surrounded the release of the Bureau of Labor Statistics’s Employment Situation Summary, as it would be the last important factor the Fed took to its Federal Open Market Committee meeting on Dec. 15.
Last week, Janet Yellen, the Fed chairwoman, declared that the U.S. economy had undergone such significant recovery over the last few years – with the central bank making up a lot of distance in its price stability and employment goals – that a rate change was appropriate. The decision has been a long time coming, as short-term interest rates haven’t increased in nearly a decade.
The U.S. economy added 211,000 jobs in November, according to the BLS. October’s already blockbuster jobs numbers, meanwhile, were revised upward by 26,000 to 298,000. Economists with The Wall Street Journal had expected to see growth of around 200,000 jobs last month, so the preliminary figures track with forecasts. November marks the 62nd consecutive month of positive job growth.
James Sweeney, an economist with Credit Suisse, told the Financial Times that the figures were “very solid, very consistent with Fed hiking. This suggests the U.S. consumer as a primary engine of global demand remains at full throttle.”
The unemployment rate remained unchanged at 5 percent, indicating that more Americans left the dugout to search for jobs in the expanding market. Labor force participation rose very slightly in November, from 62.4 percent to 62.5 percent, while the share of adults with employment remained level at 59.3 percent, according to The Journal. The BLS report follows other positive news this week regarding new weekly claims for unemployment benefits, job openings and private payroll surveys.
In the last few months, jobs data has appeared to punch above its weight class in terms of paving the way for predicted rate increases. The Labor Department’s findings continue to paint a healthy economic picture despite the fact that wage gains have been quiet – average hourly earnings were up only 2.3 percent from last year – and many Americans remain underemployed. Officials have said that genuine economic health depends on inflation returning to 2 percent and wages increasing.
Finance industry hiring solid
Construction, professional and technical services, healthcare and restaurants and bars led job gains in November. Employment in manufacturing slid somewhat, losing 1,000 jobs, while mining and logging industry jobs – hard hit by falling oil investment – tumbled by 11,000.
“The finance industry added 14,000 jobs last month, improving on October’s 10,000.”
Financial activities, meanwhile, along with transportation and warehousing and government, saw little change from October. The finance and consulting industry added 14,000 jobs last month, a respectable if not explosive improvement on October’s 10,000 jobs.
The increase in financial hiring doesn’t come as a surprise to college seniors. On competitive campuses, few industries recruit so aggressively. With accounting jobs and positions in asset management proving so popular, and with firms hiring accordingly, talented candidates are finding employment in increasingly larger numbers. If Friday’s BLS report makes anything evident, it’s that now is a great time for the economy in general and the finance industry in particular.