US job growth experienced a stronger-than-expected rebound in November, following a dip in October attributed to government spending cuts. According to the latest figures, nonfarm payrolls increased by 64,000 jobs last month. This uptick comes after the economy shed 105,000 jobs in October, a decline largely due to the departure of over 150,000 federal employees who accepted deferred buyouts as part of the previous administration’s efforts to reduce the size of the government. The majority of these employees left government payrolls at the end of September.
The unemployment rate, although reported at a more than four-year high of 4.6 per cent last month, should be interpreted with caution. The Bureau of Labor Statistics implemented a change in its methodology following a government shutdown that disrupted data collection from households. Consequently, no official unemployment rate for October was published, impacting the comparability of the data.
Kathy Bostjancic, chief economist at Nationwide, commented on the employment figures, stating, “The firmer private sector employment figures support the Fed taking a pause in its rate-cutting cycle for some period.” This suggests that the improved job market conditions could influence the Federal Reserve’s monetary policy decisions in the near future, potentially leading to a period of stability in interest rates.
