Unemployment Rate Edges Down to 3.7 Percent

December 8, 2023 – Employment rose by 199,000 in November as the U.S. unemployment rate was unchanged at 3.7 percent, according to the most recent U.S. Bureau of Labor Statistics report. The number of unemployed persons was 6.3 million in November. Job gains occurred in healthcare and government. Employment also increased in manufacturing, reflecting the return of workers from a strike. Employment in retail trade declined.

Among the major worker groups, the unemployment rate for teenagers (11.4 percent) edged down in November. The jobless rates for adult men (3.7 percent), adult women (3.1 percent), Whites (3.3 percent), Blacks (5.8 percent), Asians (3.5 percent), and Hispanics (4.6 percent) showed little or no change over the month. In November, the number of long-term unemployed (those jobless for 27 weeks or more) edged down to 1.2 million. These individuals accounted for 18.3 percent of all unemployed persons.

The number of persons employed part time for economic reasons decreased by 295,000 to 4.0 million in November. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs. In November, the number of persons not in the labor force who currently want a job was 5.3 million, little different from the prior month. These individuals were not counted as unemployed because they were not actively looking for work during the four weeks preceding the survey or were unavailable to take a job.

Among those not in the labor force who wanted a job, the number of persons marginally attached to the labor force changed little at 1.6 million in November. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the four weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, was 421,000 in November, essentially unchanged from the previous month.

“The job market continues to be resilient after a year of dodging recession fears,” said Daniel Zhao, lead economist at job ratings site Glassdoor. “Really the one concern that we had coming in today’s report was the recent rise in the unemployment rate. So the improvement in unemployment was a welcome relief.”

“What we wanted was a strong but moderating labor market, and that’s what we saw in the November report,” said Robert Frick, corporate economist with Navy Federal Credit Union, noting “healthy job growth, lower unemployment, and decent wage increases. All this points to the labor market reaching a natural equilibrium around 150,000 jobs [per month] next year, which is plenty to continue the expansion, and not enough to trigger a Fed rate hike.”

Where Job Growth Occurred

• In November, healthcare added 77,000 jobs, above the average monthly gain of 54,000 over the prior 12 months. Over the month, job gains continued in ambulatory health care services (+36,000), hospitals (+24,000), and nursing and residential care facilities (+17,000).

• Government employment increased by 49,000 in November, in line with the average monthly gain of 55,000 over the prior 12 months. Employment continued to trend up in local government (+32,000) and state government (+17,000) over the month.

• Employment in manufacturing rose by 28,000 in November, reflecting an increase of 30,000 in motor vehicles and parts as workers returned from a strike. Employment in manufacturing has shown little net change over the year.

• In November, employment in leisure and hospitality continued to trend up (+40,000), almost entirely in food services and drinking places. Leisure and hospitality had added an average of 51,000 jobs per month over the prior 12 months.

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• Employment in social assistance continued to trend up in November (+16,000). The industry had added an average of 23,000 jobs per month over the prior 12 months. Over the month, employment continued to trend up in individual and family services (+9,000).

• Retail trade employment declined by 38,000 in November and has shown little net change over the year. Employment decreased in department stores (-19,000) and in furniture, home furnishings, electronics, and appliance retailers (-6,000) over the month.

• In November, employment in information changed little (+10,000). Motion picture and sound recording industries added 17,000 jobs, mostly reflecting the resolution of labor disputes in the industry. Overall, employment in the information industry has declined by 104,000 since reaching a peak in November 2022.

• Employment in transportation and warehousing changed little in November (-5,000). A job loss in warehousing and storage (-8,000) was partially offset by a gain in air transportation (+4,000). Employment in transportation and warehousing has declined by 61,000 since a peak in October 2022.

• Employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; wholesale trade; financial activities; professional and business services; and other services.

Related: Why CEOs are Looking to Prepare Now for 2024

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Executive Editor; Lily Fauver, Senior Editor – Hunt Scanlon Media

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