The most recent jobs report released today by the Bureau of Labor statistics is a rapid and unexpected improvement for the American workforce. Instead of shedding hundreds of thousands of jobs, as in months past, the November report indicated the economy lost only 11,000 jobs and the unemployment rate actually went down.
Another bit of good news is that the Bureau also revised downwards the job losses by 159,000. That means the job situation has likely been improving for a longer period of time than many people had expected.
While undoubtedly good news, the most recent jobs report should be kept in perspective. While the unemployment rate did indeed drop, it is still at 10%, a historically high number. 15.4 million Americans still remain unemployed. The rate also does not account for thousands of workers who have given up looking for work or are underemployed, working only part time jobs. When those factors are taken into account the true unemployment situation looks much more bleak.
So does the latest report signal that the job situation has finally turned a corner? Certainly a month month uptick does not make a trend, but there are signs that job growth may finally be catching up to the growth of the overall economy. The manufacturing and construction sectors – which were a huge source of job losses since the recession began – have shown signs of stability. Health care and temporary agencies also added jobs in November.
The big unknown factor in the jobs recovery is how much consumer spending will rise. Early results of holiday shopping indicate that while spending has not dropped from last year it has not measurably increased either. It may not be until after the holiday season is over that we will know for certain whether this is the beginning of job gains and not losses.