National jobless rate hits a four-year low

McClatchy NewspapersDecember 7, 2012 

— Employers added a better-than-expected 146,000 jobs in November and the unemployment rate tumbled to 7.7 percent, the government said Friday in a report that showed the economy gaining momentum.

The hiring numbers were well above the expectations of mainstream economic forecasters, who had projected a sluggish month of hiring because of superstorm Sandy and the damage it left on the East Coast as it made landfall Oct. 29.

Instead, Sandy seemed to have little effect on the national picture, and the Bureau of Labor Statistics, part of the U.S. Labor Department, felt compelled to say as much when it released the monthly jobs report.

“Our analysis suggests that Hurricane Sandy did not substantively impact the national employment and unemployment estimates for November,” the BLS said, noting that response rates to its survey from businesses were within normal ranges.

Statisticians revised down the previous employment estimates for September and October by a combined 49,000 jobs, and the 146,000 additional jobs in November, while higher than anticipated, are right in the range of the average for the first 11 months of the year. That average is 151,000, according to the BLS, and this appears to be about the best that economists expect in a subpar economy that’s still struggling to recover from the so-called Great Recession.

“The job market held firm in the face of super-storm Sandy and growing worries over the fast-approaching fiscal cliff,” said Mark Zandi, the chief economist for forecaster Moody’s Analytics. “The solid job numbers probably overstate the case. The BLS will likely revise down its numbers once it gets more data from the Sandy-hit region.”

More surprising than the stronger-than-expected numbers was the drop in the jobless rate. It fell two-tenths of a percentage point to 7.7 percent.

“Sandy likely caused people to stop looking for work. Therefore they fell out of the labor force. The survey was done early this month and when Sandy’s impact on the job market was at its peak,” said Zandi, who said he expected revisions when December job numbers were released next month.

Friday’s unemployment rate is the lowest it has been since December 2008, and the White House and many economists no longer think the rate is a statistical anomaly.

“Over the last 12 months, the unemployment rate has decreased by 1.0 percentage point as a result of growing employment, and the labor force participation rate has been essentially unchanged,” Alan Krueger, the head of the White House Council of Economic Advisers, said in a blog posting on the jobs report.

November’s job gains were fairly broad, across most sectors. Retailers led the charge, with 52,600 additional hires, followed by professional and business services at 43,000. Leisure and hospitality, a reflection of consumer and business sentiment, rose by 23,000, followed by health care adding 22,000 jobs.

On a down note, however, the hard-hit construction sector shed another 20,000 jobs and manufacturing went negative, too.

There was plenty of evidence in the jobs report of how much stress remains in the labor force. The number of long-term unemployed, people who have been out of work for 27 weeks or more, remained stuck around 4.8 million in November, and these Americans account for 40.1 percent of the ranks of the unemployed.

The number of people employed part time who want to work full time, known as involuntary part-time workers, stood unchanged at 8.2 million in November. These are generally workers whose hours have been cut back.

Additionally, there are another 2.5 million people who are considered marginally attached to the workforce, a number that’s unchanged from a year before. These are people who aren’t in the labor force but are available for work and had looked for jobs sometime in the last 12 months.

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