–Nov Payrolls +39K; Unemployment Rate Up to 9.8%

By Denny Gulino

WASHINGTON (MNI) – Weak holiday retail hiring in November dashed
expectations with payrolls growth in Friday’s jobs report a lackluster
39,000 and the unemployment rate moving higher by two tenths after three
months of stability. Only health care, temporary help and mining posted
noticeable growth while local government shed jobs.

Retailers hired 301,000 workers in November, which after seasonal
adjustment turned into a decline of 28,000 for the key category. Only
car dealers could show some additional hiring in November, a 5,000 jobs
increase, while losses elsewhere in retailing after adjustment were
widespread. Department stores were negative by 9,000, furniture stores
5,000 and clothing stores 2,000.

“They did hire, just not as much as expected,” the chief of the BLS
employment section Tom Nardone told Market News International of
retailers just prior to the countdown to 8:30 a.m. for public release of
the November report.

“You don’t have a lot of areas where there’s growth” in November,
he said. “This month you were limited to temporary help, which was up
40,000 and has been growing for a while, and health care, up 19,000.”
While the latest month “might have been a little weak” for health care,
the category “has been growing about the same as 2009.”

The increase in the unemployment rate of 0.173 point, to 9.817%.
wasn’t all employment decreases and it wasn’t all that the labor force
got bigger either,” but rather reflected “changes in both the employment
level and the unemployment that were not statistically significant,” he
said.

“If you look at the unemployment rate, it had ticked up in April to
9.9%, but for most of year it’s been flat, with the three months before
November 9.6%, and it’s been very close to that most of the year,” he
said.

Employment in the accompanying survey of households slipped 173,000
while unemployment rose 276,000 along with a labor force that expanded
just 103,000.

Without the month’s relatively modest seasonal adjustment, there
were actually 217,000 additional payroll slots in November that
adjustment translated into the 39,000 increase. In January the seasonal
adjustment becomes immense, as “close to 2.5 million” workers are
typically laid off in retail, construction and other categories, he
said.

The Bureau of Labor Statistics did also report upward revisions in
September and October payrolls that added 38,000, almost as many as
November added.

Earnings through November for all employees rose just 1.6%
over the year after showing a 1.7% annual increase for the prior
three months. For production workers, that annual increase through
November was 2.1%. In what used to be considered more normal times, that
annual increase would be above 4%, such as the 4.1% in December 2006.

In hours worked, “not much was going on,” Nardone said, with all
weekly hours unchanged, as were factory hours and factory overtime. In
fact, he said, “Unchanged or little changed was a big theme in this
month’s report.”

The continuing strength of temporary help hiring, up 474,000
since September of last year, seemed somewhat at odds with the
weakness elsewhere. After “tapering off in the summer,” temporary
help hiring has revived.

“It all means, you have to be really careful about declaring the
end of the problem,” Nardone said. Expectations in a Market News
International survey had centered on a gain of 150,000 and the
unemployment rate had been seen holding steady.

“If you’re looking for positive numbers, the November number, even
though weak, still has a positive sign in front of it. We’ve now added
employment 11 months in a row, or 951,000 jobs, about 86,000 a month.”

Private payrolls in November gained 50,000 and this year have
gained 106,000 a month for a total of 1.171 million. Total government in
November lost 11,000 with local government showing a decline of 14,000.
State government gained 2,000 and the federal government was up 1,000.

“On the negative side, the topside number isn’t very big,”
he continued. “The areas seeing continual growth are very narrow,
health, temps and mining, and there are a lot of areas that are
not doing much — not big negatives like we saw, but not generating big
positives.”

In January the BLS is lengthening its measure of employment
duration in its household survey to up to five years. Now respondents to
the monthly survey are only able to report their jobs have lasted up to
two years. The change will likely affect the BLS report on average
employment duration but will not affect the estimate of total
unemployment or other data series.

** Market News International Washington Bureau: (202) 371-2121 **

[TOPICS: MX$$$$,MAUDS$,MFU$$$,MGU$$$]