AILSA CHANG, HOST:
The U.S. job market has not lost its mojo. Today, we learned that U.S. employers added 227,000 jobs in November, and that was reassuring after lackluster job gains the month before. NPR's Scott Horsley joins us now from Midway Airport in Chicago. Hi, Scott.
SCOTT HORSLEY, BYLINE: Hi, Ailsa.
CHANG: All right, so what does today's report tell us about the overall job market?
HORSLEY: Well, it tells us the job market is still holding up. You know, employers are not adding jobs quite as fast as they were, say, a year ago, but many are still hiring. And as we suspected, that steep drop in hiring in the October report appears to have been a temporary speed bump, not the edge of a lasting cliff. You know, October's jobs numbers were depressed by the Boeing Strike, which idled tens of thousands of workers, and by Hurricanes Milton and Irene, which sidelined many more.
But the Boeing workers are back on the job now. Some of the businesses that were shuttered by the hurricanes have begun to reopen. And Austan Goolsbee, who heads the Federal Reserve Bank here in Chicago, says, when you look past the temporary noise, the job market seems to be settling into a comfortable groove.
AUSTAN GOOLSBEE: It was cooling for a while from the hottest that we've ever seen to something like sustainable full employment, let's call it. And what we want it to do is stabilize there and not keep getting worse. And the last several months feel like it's hovered around in that space.
HORSLEY: Revised figures show October's hiring wasn't quite as weak as first reported. And September's job gains were also revised up. You know, even with the end of the Boeing Strike, I should say, manufacturing is still a weak spot in the job market, but we're seeing much stronger gains in services like health care and hospitality.
CHANG: And to be clear, the unemployment rate is still low?
HORSLEY: It is. Yeah, unemployment inched up a little bit in November from 4.1- to 4.2%, but that's still quite low by historical standards. We're also seeing an uptick in the number of workers quitting jobs, which typically is a sign that they're pretty confident they can find another position. Maybe the clerest signal that we're still in a pretty solid job market is that wages continue to go up at a pretty healthy pace. You know, average wages in November were 4% higher than a year ago. That's almost certainly a bigger jump than we saw in prices. We'll find out for sure next week when the inflation data comes out. But wages have been going up faster than prices for a year and a half now, and that's good news for workers. It means their buying power is actually growing.
CHANG: Well, let me ask you, if the Federal Reserve has been watching the labor market and the cost of living as it tries to decide whether to keep cutting interest rates, how do you think Fed officials interpret these numbers?
HORSLEY: As always, the Fed is still trying to strike a balance. You know, higher interest rates help to bring down inflation. Lower interest rates help prop up the job market. Inflation's come down a lot, but it's not quite back to the Central Bank's 2% target yet. And today's report likely means the Fed can take its time in lowering interest rates. Remember, the Central Bank cut its benchmark rate by half a percentage point back in September when policymakers were really kind of worried that the job market was going soft.
Since then, though, the job market has looked more resilient, so Fed officials feel like they can move cautiously. Markets are betting the Fed will cut rates by a quarter-percentage point at their next meeting in a couple of weeks. But after that, the Fed could kind of be in wait-and-see mode. You know, policymakers feel like they don't need to be in a hurry to cut rates because the job market doesn't look to be in danger of sudden collapse.
CHANG: That is NPR's Scott Horsley. Thank you so much, Scott.
HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.
NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
