November Jobs Report Commentary from MBA's Mike Fratantoni

The following is MBA SVP and Chief Economist Mike Fratantoni’s reaction to this morning’s U.S. Bureau of Labor Statistics report on employment conditions in November.  

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“Although payroll employment rebounded in November with a gain of 227,000 jobs, and the prior months were revised upwards by a cumulative 56,000 jobs, the report overall shows more softening in the labor market. The unemployment rate is now above 4.2%, the household survey again showed a large drop in employment, and more households reported spells of long-term unemployment. Per the JOLTS results from October, the hiring rate continues to decline. While we are not seeing a pickup in layoffs, new entrants and individuals who lose jobs are having a more difficult time regaining employment.

“The payroll gains continue to be concentrated in just a few sectors, government, health care, and leisure and hospitality. The rebound followed a net loss of private sector jobs in October with the impact of the hurricanes. Wage growth remained steady at 4% on an annual basis.

“Fed officials have pointed to their ‘data dependence’ when it comes to decisions about future rate cuts. These data support a cut at the December meeting, and MBA forecasts that the Fed will continue to reduce short-term rates in 2025, although they are likely to slow the pace of cuts.”