Source TOI
The US labour market showed signs of slowing in November, with the unemployment rate ticking up and job creation losing momentum, raising fresh concerns about the strength of the world’s largest economy.
According to official data released on Friday, the unemployment rate rose to 4% in November, up from 3.9% in October, as hiring cooled across several sectors. The economy added fewer jobs than expected, signalling a gradual easing of labour market tightness that had supported strong growth over the past year.
Non-farm payrolls increased by around 199,000 jobs, slightly above October’s revised figure but below the average monthly gains seen earlier in 2024. Job growth remained concentrated in healthcare, government and leisure and hospitality, while sectors such as manufacturing and retail showed little to no expansion.
Wage growth also moderated, with average hourly earnings rising at a slower pace, suggesting easing inflationary pressures. Economists see this as a positive sign for the US Federal Reserve, which has been closely watching labour market trends while deciding its next move on interest rates.
“The data points to a gradual cooling rather than a sharp downturn,” analysts said, noting that while job creation is slowing, the labour market remains relatively resilient.
However, the rise in unemployment reflects increasing participation in the workforce as more Americans return to job hunting, alongside cautious hiring by employers amid high borrowing costs and global economic uncertainty.
The latest figures come at a crucial time for policymakers, with markets now expecting the Federal Reserve to maintain interest rates in the near term, while keeping the door open for possible rate cuts in 2025 if inflation continues to ease and job growth slows further.
Despite the November stumble, experts say the US labour market remains fundamentally strong, though the coming months will be key in determining whether the slowdown deepens or stabilises.
