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U.S. economy added 321,000 jobs in November; unemployment rate holds at 5.8%
The Washington Post
December 5, 2014
A months-long hiring spree has pushed the U.S. labor market closer to full health, providing workers with their best chance since the financial crisis to find higher-paying jobs or enjoy see long-awaited wage increases.
On Friday, the government announced that the U.S. economy added 321,000 jobs in November, the best figure in nearly three years, keeping the country on track for the strongest annual job growth since the late 1990s. That performance, coming even as other advanced economies slump, has lifted hopes among economists and U.S. officials that a slow, six-year recovery is beginning to yield substantial benefits for ordinary workers.
Workers are not only reentering the labor force from the sidelines, data show, but also growing increasingly likely to have the to confidence to quit their jobs and move to better ones that pay more or more closely match their skills.
“We are kind of hitting that point where the tide is turning, and the labor market is more in favor of the worker than it has been in many years,” said Tara Sinclair, chief economist at Indeed.com, a job search Web site.
For several years, the U.S. recovery has felt stubbornly incomplete: Jobs have come back while wages have stagnated. But the latest numbers came with nascent signs of wage growth, the result of qualified individuals reentering the workforce, putting pressure on companies to retain their best employees or bid for new applicants.
According to Labor Department data Friday, average hourly wages spiked 0.37 percent from October to November, the sharpest month-to-month change in more than a year.
If salaries continue to grow, economists say, Americans will be taking home more money even as they spend less as the pump, due to falling oil and gasoline prices. The potent combination wouldboost the amount of money Americans have to spend and provide a broader lift to the economy.
Still, economists said it was far too early to declare that a robust wage recovery had begun. Over the course of a year, hourly earnings are still up only 2.1 percent, just a tick above the inflation rate, but weekly earnings provide a more encouraging sign. The average American last month took home $853.24 per month — a 2.4 percent increase from the $833.18 figure of a year earlier — partly because of working longer hours.
“One month does not make a trend, but I am encouraged,” Department of Labor Secretary Thomas E. Perez said Friday in an interview. “One of the best ways to lift wages is to pick up the pace of job creation, which is exactly what we’re doing. Because job creation will trigger more upward pressure on wages.”
Some economists said that November’s data has put the American economy in its best position in years. The unemployment rate remains at 5.8 percent, a post-recession low point. So far this year, the United States has added some 2.65 million jobs, an average of about 241,000 a month. For 10 straight months now, the economy has added at least 200,000 jobs. That hasn’t happened since 1994.
President Obama said on Friday that the United States has added more jobs over the last four years than Europe, Japan, and all other advanced countries combined. Other U.S. officials noted that job growth in November was driven by traditionally blue-collar or higher-skill sectors, a contrast to the low-wage boom earlier in the recovery.
In November, the business and professional services sector — accountants, engineers, administrators — added 86,000 jobs, tops among all industries. This year, the country has added about 15,000 manufacturing jobs per month, more than double the pace from 2013. Construction has added about 21,000 per month this year, compared with 13,000 per month in 2013.
“The labor market is healing faster than almost any analysts expected just a few months ago,” Scott Anderson, chief economist at Bank of the West, said Friday.
In one sign of labor market confidence, workers have grown more likely to quit their jobs, meaning they’ve either received new employment offers or feel confident they will. According to the Federal Reserve Bank of St. Louis, the “quit rate,” as it is known, now stands at 2.2 percent among private workers. From July 2008 to July 2014 the rate never surpassed 2 percent.
People grow likelier to leave their jobs when the broader economy is functioning well, and in recent months, some have taken positions they couldn’t find earlier in the recovery. Others have left jobs they disliked and reentered the hunt.
Some, like Daniel Ovalles, 25, have found new jobs they never even expected.
Ovalles, who has an engineering degree from Texas A&M, has the kind of story that would have sounded jarring a few years earlier: An opportunity literally landed in his LinkedIn inbox.
At the time he received the note, Ovalles was working a terrific job that was also a major grind. He spent his time in the remote Texas oilfields as a field engineer for Schlumberger, an oil services company.
Ovalles made $150,000 annually, but he was on the road so often that he didn’t even have an apartment. He’d bounce from job to job — Midland, Tex.; Laredo; Victoria — working 12-hour shifts, spending his down time in a mobile trailer he shared with three other employees.
The e-mail came from Murray Resources, a Houston-based staffing and recruiting agency that has doubled its own staff in the last year to keep pace with increased demand — likely the result of a stronger overall economy combined with a domestic energy boom.
Murray contacted Ovalles on behalf of BC Johnson, a risk management consulting firm that specializes in the energy industry. Murray noticed Ovalles’ LinkedIn profile — his oil field work; his fluency in Spanish — and thought he’d be a good fit.
Ovalles, at first, didn’t pay the inquiry any attention. Then he spent three more weeks in the field.
“That’s when you start going crazy,” he said. “So I looked at it again.”
He put in his two-weeks’ notice and thanked Schlumberger for the opportunity.
Now, in his new job, which he started in October, Ovalles works from 8 a.m. until 4 p.m. He has a 15-minute commute from his apartment. His salary is slightly reduced, but he feels he traded up, taking an opportunity that might not have been available several years earlier.
“You have to have that life balance,” he said, “and in my old job I didn’t.”