The big question on the minds of analysts in the United States is whether there will be a soft landing after the severe policy of the Federal Reserve (Fed) to contain inflation. One of the barometers is the labor market, which again demonstrated its resilience this Friday, despite the restrictive monetary policy. There is a slowdown, but not a big pullback, and that makes the idea of ??a recession fade away.
The US added 199,000 jobs in November, above forecasts (180,000) and beating October’s 150,000, as the Fed weighs whether to keep rates on hold at next week’s meeting or apply another increment.
Fed Chairman Jerome Powell said that rate hikes may have reached their limit, although he insisted that the start of the cut was not yet in sight. Despite the fact that the inflation rate has fallen back to 3%, it still does not reach the goal of 2% set by the Federal Reserve and they do not call the task over.
The unemployment rate, which had been expected to hold steady at 3.9%, fell to 3.7%, slightly higher than the record earlier this year, but roughly at the level of record in several decades. The labor force has increased by 62.8% of the active population.
These numbers show that there is substance left in a labor market that has slowed, albeit almost imperceptibly, since the US central bank began tightening interest rates in March 2022. placing them at 5.25-5.50%, the highest level recorded in 22 years.
However, this is the second month in a row that job gains have been below the 2023 average.
The increase in employment includes about 41,000 workers in the auto industry and the actor collective, once both sectors regained normalcy and returned to work after long strikes, as well as other businesses who were weighed down by the protests of their employees.
The average salary, a key element of inflation, rose 0.4% from last month and 4% in annualized value. The monthly increase was also above the 0.3% estimate, but in annual terms it is in line with what has been expected.
The data has fueled optimism among US economists, who believe a soft landing can be achieved. That means putting inflation in place without a recession.
Analysts such as Stephen Juno, of Bank of America, say that the trend points in the direction of a soft landing and, in turn, the labor market is approaching an ever-improving balance sheet. This circumstance means that the number of available workers grows, while recruitment needs are eased, the lack of employees is cut and wage pressure is lowered.
