Payrolls in US rise; jobless rate falls on lower participation

United States hiring picked up in November, while the unemployment rate tumbled to a nine-year low on a drop in the number of people in the workforce and wages unexpectedly declined, providing a mixed picture of the labour market.

The 178,000 gain followed a 142,000 rise in October that was less than previously estimated, a Labor Department report showed Friday. The median forecast in a Bloomberg survey called for a 180,000 advance. The jobless rate fell 0.3 percentage point to 4.6 per cent as labour participation dropped for a second month.

A steady job market signals employers were willing to keep hiring in the days before and after the November 8 presidential election. At the same time, while the Federal Reserve is almost certain to raise borrowing costs this month, sustained weakness in wages or participation would weigh on the economic outlook.

“You have to look at the underlying trend and that’s still pretty good,” Scott Brown, chief economist for Raymond James Financial Inc. in St. Petersburg, Florida, said before the report. “We’re at a time of the year when there are a lot of seasonal issues. Investors are looking well beyond, at what’s going to happen in 2017.”

Revisions to prior reports subtracted a total of 2,000 jobs from payrolls in the previous two months.

November payroll estimates ranged from gains of 140,000 to 250,000. October was initially reported as a 161,000 increase.

The unemployment rate, which is derived from a separate Labor Department survey of households, was projected to hold at an eight-year low of 4.9 per cent, according to the survey median.