US labor market data for October and November painted a clear picture of weakness. Payrolls plunged by -105k in October, the sharpest monthly decline since late 2020. November delivered a rebound of 64k jobs, beating expectations, but the gain was far too small to offset the prior month’s contraction, leaving overall payroll growth effectively flat since April.
Labor market slack continued to build. The unemployment rate rose to 4.6% in November, above expectations and up from 4.4% previously in September. That increase came alongside a modest rise in the labor force participation rate to 62.5%, suggesting that some of the uptick in unemployment reflects workers re-entering the labor market rather than outright layoffs.
Wage growth offered little offsetting support. Average hourly earnings rose just 0.1% mom, well below expectations of 0.3% mom, reinforcing signs that pay pressures are easing as demand for labor cools. The combination of weak net job creation, rising unemployment, and softer wages strengthens the case that the US labor market is losing momentum.
