Hiring in the US remained strong in November

The nation’s employers continued to hire briskly in November despite high inflation and sluggish economic growth, a sign of resilience in the face of the Federal Reserve’s aggressive interest rate hikes.

The economy added 263,000 jobs, while the unemployment rate held at 3.7%, still near a 53-year low, the Labor Department said Friday. November job growth slowed only slightly from October’s gain of 284,000.

Hiring last month represented a substantial increase. All year long, as inflation has risen and the Federal Reserve has imposed ever-higher interest rates, the US job market has defied skeptics, adding hundreds of thousands of jobs, month after month.

The strength of the November hiring surge will raise concerns that the Fed will now have to keep rates high even longer than many assumed. The reaction on Wall Street was immediate, with Dow Jones Industrial Average futures falling nearly 400 points.

As employers continued to hire, wage increases followed. In November, the median hourly wage rose 5.1% from a year earlier, a sharp increase that could complicate the Fed’s efforts to curb inflation. This week, Fed Chairman Jerome Powell stressed in a speech that jobs and wages were growing too fast for the central bank to quickly rein in inflation. The Fed has raised its benchmark rate, from near zero in March to nearly 4%, to try to push inflation back toward its 2% annual target.

Meanwhile, steady hiring and rising paychecks have helped American households boost the economy. In October, consumer spending rose at a healthy pace even after adjusting for inflation. Americans increased their purchases of automobiles, restaurant meals, and other services.

After having contracted in the first six months of the year, the US economy expanded at an annual rate of 2.9% in the last quarter. In addition to the strength of consumer spending, an increase in exports helped boost growth.

Although steady hiring and rising wages have fueled their spending, Americans are also increasingly turning to credit cards to keep up with higher prices. Many are also looking for savings, a trend that cannot continue indefinitely.

Some signs of weakness have raised concerns about a possible recession next year, in part because many fear that the Fed’s escalating rate hikes will eventually derail the economy. Particularly in the technology, media and retail industries, a growing number of companies have made high-profile layoff announcements.

[Con información de The Associated Press]

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