WASHINGTON – The unemployment rate dipped and job creation remained steady in November, as the U.S. economy shrugged off any major influence from Hurricane Sandy and showed surprising resilience in the run-up to the fiscal cliff.
The November jobs report, released Friday, was a pleasant surprise to analysts who had braced for some ugly numbers for a period during which much of the Northeast was reeling from the superstorm.
In fact, the nation’s jobless rate fell to 7.7 percent from 7.9 percent, and the nation added 146,000 jobs, not the mere 85,000 that forecasters had expected.
But the report contained some ominous elements as well. The jobless rate dropped in large part because the labor force fell by 350,000, suggesting that people gave up looking for work.
The number of people saying they had a job actually fell by 122,000. And the Labor Department revised downward its estimates of job creation in September and October by a combined 49,000 jobs.
Add it all up, and the conclusion is this: The trend that we thought was under way, of a U.S. economy growing steadily but at an unspectacular pace, remains under way. It was not undone either by the hurricane or by anxiety over looming austerity – the tax hikes and spending cuts scheduled to take effect Jan. 1 if Congress and the White House can’t reach a deal.
Indeed, the job market has been remarkably consistent over the past year, adding an average of 157,000 jobs a month – well above the level needed to keep pace with a growing labor force, but slow enough that it would still take years to bring unemployment down to the 5 percent to 6 percent range.
The new report shows no real shift in that trend, which in its way is still good news: It suggests that businesses did not bring their hiring to a halt in November out of fear that lawmakers will be unable to reach a deal and the nation will hit the fiscal cliff.
The report was stronger than feared but does not materially change the outlook for the labor market, economist Ryan Wang of HSBC said in a research note.
Responding to the report, House Speaker John Boehner, R-Ohio, focused on the people who are out of work.
The Democrats’ slow-walk strategy is unfair to taxpayers, unfair to small businesses, and unfair to all those looking for work, Boehner said.
Alan Krueger, chairman of the White House Council of Economic Advisers, said, While more work remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to heal from the wounds inflicted by the worst downturn since the Great Depression.