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Dec. 4, 2020, 2:55 p.m. EST

The 245,000 new jobs added last month is smallest since U.S. recovery began in May

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Jeffry Bartash

The numbers : The U.S. regained 245,000 jobs in November and the unemployment rate declined again, but hiring fell to a seven-month low in a clear sign the record rise in coronavirus cases is damaging the economy and making it harder for people to return to work.

The increase in jobs last month fell short of the 432,000 forecast of economists polled by MarketWatch. The reaction on Wall Street was muted, with stocks opening modestly higher.

See: MarketWatch Economic Calendar

Private-sector payrolls rose by a stronger 344,000, but a nearly 100,000 drop in government jobs reduced overall employment gains.

The unemployment rate, meanwhile, fell for the seventh month in a row to 6.7% from 6.9%, marking a new pandemic low.

Yet the decline mostly reflected 400,000 people dropping out of the labor force because they either stopped looking for work or had to care for a family member who caught the coronavirus.

The Bureau of Labor Statistics said the unemployment rate would have been as much as 0.4 points higher, or 7.1%, if its household survey more accurately captured the true employment status of people who are not working right now.

The pace of hiring has been slowing for months, as expected, after millions of people returned to their jobs in May and June. Yet the U.S. has only recouped just over half of the 22 million jobs lost early in the pandemic and a winter surge in coronavirus cases threatens more layoffs at businesses such as restaurants, hotels, airlines and mom-and-pop stores.

Read: Coronavirus saps hiring, spurs more layoffs and weakens recovery

The softening labor market and mounting damage from the coronavirus could pressure Congress to end a months-long standoff and pass a new package of federal aid for the unemployed and struggling businesses.

What happened: The biggest gain in hiring last month took place at warehousing and transportation companies such as UPS /zigman2/quotes/201245396/composite UPS -0.92% , Fedex /zigman2/quotes/203047719/composite FDX -1.51% and Amazon /zigman2/quotes/210331248/composite AMZN -0.81% .

They added an unusually high 145,000 new jobs ahead of the holiday season, reflecting a surge in online shopping and an improvement in the goods-producing part of the economy. The increase accounted for 59% of all the jobs created last month.

Employment at professional firms rose by 60,000 and health-care companies created 46,000 jobs as they continued to recover from a sharp decline in employment last spring.

Manufacturers added 27,000 jobs, but companies are struggling to find skilled workers and suffering more absenteeism because of the pandemic.

Read: A bsenteeism, shutdowns’ tied to coronavirus hurt businesses

Financial firms also hired 15,000 people amid a stock market boom and flood of people applying for mortgages or refinancing home and auto loans.

/zigman2/quotes/201245396/composite
US : U.S.: NYSE
$ 178.06
-1.65 -0.92%
Volume: 2.61M
April 19, 2021 4:03p
P/E Ratio
108.37
Dividend Yield
2.29%
Market Cap
$155.94 billion
Rev. per Employee
$155,492
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/zigman2/quotes/203047719/composite
US : U.S.: NYSE
$ 283.25
-4.34 -1.51%
Volume: 1.68M
April 19, 2021 4:00p
P/E Ratio
18.66
Dividend Yield
0.92%
Market Cap
$77.27 billion
Rev. per Employee
$282,518
loading...
/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 3,372.01
-27.43 -0.81%
Volume: 2.73M
April 19, 2021 4:00p
P/E Ratio
80.76
Dividend Yield
N/A
Market Cap
$1701.59 billion
Rev. per Employee
$297,430
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