US job growth slows in November as unemployment rises to 4.6%

WASHINGTON — The United States added 64,000 jobs in November, but the government reported a 105,000 decline in October, with the data released late because of the 43-day federal government shutdown. The unemployment rate rose to 4.6%, the highest reading since 2021. Economists had expected roughly 40,000 new jobs in November, and the better-than-expected November figure helped temper some concerns about a weakening labor market. The month-to-month readings underscore a labor market that is softening but still generating payrolls, even as uncertainty weighs on hiring plans.

Healthcare providers added more than 46,000 jobs in November, accounting for the majority of the 69,000 private-sector payroll gains for the month. Construction companies expanded payrolls by about 28,000, while manufacturing shed 5,000 positions in November, marking the seventh straight monthly decline for the sector. The mix of gains and losses illustrates a labor market that is broad-based enough to keep hiring afloat in some areas while facing headwinds in others, particularly in manufacturing and supply-chain-heavy industries grappling with higher interest rates and evolving technology use.

The unemployment rate’s uptick to 4.6% reflects a labor market that has cooled from its post-pandemic peak, though it remains relatively tight by historical standards. The pace of job creation has clearly slowed as employers weigh how to deploy automation and artificial intelligence, even as they seek to retain workers in a still-uncertain environment. Analysts note that hiring appetite has diminished as firms evaluate labor needs against the potential for productivity gains through technology, as well as policy shifts abroad that could affect trade and demand for goods and services.

Wage growth remained modest in November. Average hourly earnings rose 0.1% from October, the smallest increase since August 2023. On an annual basis, pay rose 3.5%, a level that is the lowest since May 2021. The modest wage gains, coupled with a cooler job market, suggest that while employers are still hiring, they are less inclined to bid up wages aggressively in response to tight conditions.

The release comes amid ongoing debate about how much further the Federal Reserve will need to adjust interest rates to balance growth and inflation. The central bank cut its benchmark rate by a quarter of a percentage point last week, the third cut this year, though several policymakers dissented, illustrating the ongoing tension between supporting growth and taming inflation. Some officials have signaled caution about additional cuts while inflation remains above the 2% target.

The report also carried notable revisions. The Labor Department said it revised payroll figures for September and August downward by a combined 33,000 jobs, underscoring how late data and methodological updates can shift the assessed strength of the labor market. In the year that ended in March, revisions previously indicated that the economy created far fewer jobs than initially reported, further illustrating how fluctuations in government data can alter perceived momentum over time. Since March, job creation has trended lower, averaging about 35,000 new positions per month in the latest period, well below the roughly 147,000 pace first reported for the year.

The delayed data and revisions complicate the horizon for policymakers. Federal Reserve officials remain divided over whether the labor market needs additional support in the form of lower rates, a debate that is colored by inflation dynamics and the need to avoid reigniting price pressures. The upcoming policy meeting remains scheduled for Jan. 27-28, when the central bank will weigh new labor market signals alongside inflation readings and global developments.

From a broader perspective, the unemployment rate has moved higher from a 54-year low of 3.4% hit in April 2023, though it remains comparatively low by historical standards. Economists say the main takeaway is a labor market that has entered a period of moderation: hiring is proceeding, but employers are reluctant to expand payrolls aggressively amid policy and market uncertainties.

Thomas Feltmate, a senior economist at TD Economics, said the data signal a labor market that remains on a relatively soft footing, with employers showing little appetite to hire but also reluctant to lay off workers. “That said, labor demand has cooled more than supply in recent months, which is what’s behind the steady upward drift in the unemployment rate,” he wrote in a note. Analysts also pointed to the role of automation and AI in shifting labor demand, especially in sectors like logistics and transportation where robotics and software tools have begun to alter workflow.

All told, the November report reinforces a picture of a labor market that is expanding at a slower pace and facing a more uncertain policy and trade environment. For jobseekers, opportunities may be uneven by sector, with some industries continuing to post openings while others scale back hiring as they assess how to allocate resources in a shifting landscape. Financial markets and policymakers will parse the numbers for clues about the next steps in monetary policy and labor-market support, as they seek to balance growth with price stability in a world of evolving technology and uncertain global demand.