The release of the nonfarm payrolls data on Friday added further pressure on the fragile US economy.
The US Bureau of Labor Statistics reported on Friday that Nonfarm Payrolls (NFP) in the US increased by 245,000 in November. This followed two weeks of increases in initial jobless claims in the US.
November’s disappointing reading followed the increase of 610,000 (revised from 638,000) in October and heavily missed market expectations for an increase of 469,000.
The NFP report makes it seven consecutive months of job gains following April’s historic losses.
US Unemployment Edges Down
There was some good news amongst the weak NFP data.
The unemployment rate in the world’s largest economy declined to 6.7% from 6.9%, as per economist expectations.
The unemployment rate in the US has experienced a steady decline from when it peaked at 14.7% after the coronavirus first hit businesses in the US. However, the rate of improvement has slowed considerably over the last few months as the pandemic’s infection rate continues to rise throughout the country.
Robert Frick, a corporate economist at Navy Federal Credit Union, said yesterday upon the reports’ release:
“There’s no way to sugarcoat today’s weak jobs report,”
“Last year, monthly gains were about 200,000, so we are far below a good pace to return the almost 10 million jobless Americans back to work.”
Stimulus Hopes Raised
The latest set of weak economic figures from the US, is raising hopes of stimulus intervention from the US government.
The US economy is facing near-term challenges, including a new wave of virus infections. However, with a possible vaccine roll out in 2021 and a new US administration. there is some optimism.
David Berson, chief economist at Nationwide Mutual Insurance Co. said:
As infection rates go down, as the number of people vaccinated goes up, then we’ll start to see…business activity expand at a faster rate, and we will see the employment numbers pick up more strongly,”
