Federal data shows job market worsened in October and November after shutdown delays
WASHINGTON, DC: The US labor market shed 105,000 jobs in October before adding a modest 64,000 positions in November, according to delayed data released on Tuesday, December 15, by the Bureau of Labor Statistics.
It offered a clearer and more fragile picture of employment conditions after months of uncertainty.
The unemployment rate climbed to 4.6% in November, the highest level since September 2021, underscoring the growing strain in the job market.
Jobs data shows first two-month contraction since 2020
The report lifted a months-long delay caused by a prolonged government shutdown that delayed the release of key labor data.
Even before Tuesday’s figures, the national employment picture appeared shaky. Jobs reports for June and August showed net losses, the first time since 2020 that two months of contraction occurred in the same year.
September’s report, the last published before the shutdown, showed a relatively modest gain of 119,000 jobs and an unemployment rate little changed at 4.4%.
The BLS also revised down earlier estimates, saying employment in August and September combined was 33,000 lower than previously reported.
Federal workforce drives October decline
Economists had widely anticipated job losses in October followed by a mild rebound in November, a pattern largely borne out in the data.
Federal government employment posted a steep decline in October, falling by 162,000 jobs. The BLS attributed the drop to federal employees who accepted deferred resignation offers and subsequently came off the government payroll.
The program was implemented under Elon Musk’s now-defunct Department of Government Efficiency. Since the start of the year, federal employment has fallen by 271,000 positions.
Newly released data shows wage growth lags inflation
Pay gains also showed signs of cooling. Average hourly earnings rose just 0.1% in November and were up 3.5% over the past year.
With inflation’s most recent reading in September running only half a percentage point lower, wage growth has provided little boost to consumers’ purchasing power.
Consumer spending data also reflected that strain. Retail and food services sales totaled $732.6 billion in October, slightly below September’s level, the Census Bureau reported Tuesday.
Overall sales were virtually unchanged month over month, though they were up 3.5% compared with October 2024. Excluding auto and food sales, retail spending edged up to $633.2 billion, a slight increase from September.
Shutdown leaves gaps in data in October report
The 43-day government shutdown, which ended on November 12, limited the BLS’s ability to collect data, leaving some gaps in the October report.
No unemployment rate or labor force participation rate was released for that month, and certain demographic details remain unavailable.
The next major economic release comes on Thursday, when the BLS is scheduled to publish inflation data that was also delayed by the shutdown.
Despite the overall weakness, some sectors posted gains in November. Health care added 46,000 jobs, while construction payrolls increased by 28,000.
The BLS noted that 19,000 of those construction jobs were in “non-residential specialty trade contractors,” a category that could include work tied to AI data centers.
Losses, however, mounted in transportation and warehousing, led by a drop of more than 18,000 couriers and messengers.
Leisure and hospitality employment fell by 12,000 jobs, another potential red flag for consumer-driven growth. Other major industries, including manufacturing, retail trade, information and financial services, showed little to no growth.
Stock futures traded largely flat following the release. Federal Reserve Chair Jerome Powell already played down the importance of the delayed report last week, cautioning that the data could be “distorted” by the effects of the shutdown.
