Job growth in the United States crawled to a near halt in November as a new estimate from ADP and Moody’s Analytics shows private payrolls increasing by only 67,000. This assessment is well below the 150,000 growth consensus economists surveyed by the Dow Jones had originally estimated; and it is the lowest metric since May.
The gap between the estimate and the reality seems to question the somewhat upbeat sentiments that concluded last week, when the closely-watched non-farm payrolls were forecast at 187,000 (boosted mostly by the end of the GM worker strike).
But the tally of November’s employment was a big drop from the 121,000 in October; and even that was revised down from an initially-reported 125,000.
Sure enough, Moody’s Analytics chief economist Mark Zandi comments, “The job market is losing its shine. Manufacturers, commodity producers, and retailers are shedding jobs. Job openings are declining, and if job growth slows, any further unemployment will increase.”
Zandi also notes that the US-China trade relationship—and particularly any new tariffs—will definitely continue to impact the overall employment picture in the United States. With the manufacturing, resources, and commodities industries all weaker due to the new exchange of several hundred billion dollars worth of duties have kept both sides of this issue quite pallid, with the possibility that it will sustain like this for the duration of negotiations.
Indeed, goods-producing industries are down 18,000 jobs for the month. This decline came out of a pretty even split of loss between natural resources and mining, construction, and manufacturing.
In addition, the trade, transportation, and utilities sector—which typically yields fair job creation—also saw contraction. This sector is down 15,000 payrolls; information saw a decline of 8,000. Finally, small businesses also did not fare well last month: companies with less than 20 employees declined by 15,000 payrolls as well.
In a conference call with the media Zandi goes on to say, “The slowdown is more significant than I would have thought, and I do think that goes to the trade war. Tjhe trade war is doing damage to the economy and the jobs market.”