WASHINGTON (AP) — The nation’s employers added 199,000 jobs last month and the unemployment rate fell, hopeful signs that the economy could achieve an elusive “soft landing,” in which inflation would return to the Federal Reserve’s 2% target without causing a steep recession.
Friday’s report from the Labor Department showed that the unemployment rate dropped from 3.9% to 3.7%, not far above a five-decade low of 3.4% in April.
The November gain was a reminder that many employers continue to hire, though last month’s increase was inflated by the return of about 40,000 formerly striking auto workers and actors, who were not at work in October but returned in November.
Still, the job market is gradually decelerating along the lines that Fed officials have wanted to see. The Fed has raised its key short-term rate from near zero to about 5.4%, a 22-year peak, leading to higher borrowing rates for consumers and businesses and lower inflation. Despite that headwind, the economy and the job market are still expanding. Layoffs remain historically low.
When the Fed meets next week, it is considered sure to keep its benchmark rate unchanged for the third straight time in light of the easing inflation pressures. Most economists and Wall Street traders think the Fed’s next move will be to cut rates, though that might not happen until the second half of 2024.
Even modest hiring helps ensure that consumers, who drive most of the economy’s growth, keep spending. Early reports on holiday shopping showed healthy growth in online sales.
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