What’s going on here?

The US job market saw a robust rebound in November, with nonfarm payroll employment climbing to 227,000, as the economy shrugged off disruptions from recent hurricanes and a Boeing strike.

What does this mean?

While November's payroll increase shows resilience, the broader hiring trend is less encouraging. Average private payroll growth over the past six months has dipped to 108,000, marking the slowest pace since the post-pandemic recovery.

That slowdown is reflected in economic indicators like the payrolls diffusion index and the jobs openings and labor turnover survey (JOLTs), indicating reduced confidence across sectors. As fewer industries add jobs, the employment rate from the household survey dropped, pushing unemployment to 4.2% from 3.4% earlier in 2023.

Why should I care?

For markets: Tracking market impacts of job trends.

Interestingly, the Federal Reserve is concerned about further labor market loosening, with the rising unemployment rate being likely having a big influence on the central bank's thinking. That, therefore, increases the likelihood of an interest rate cut in December, with this week's Consumer Price Index (CPI) report set to play a pivotal role in upcoming economic policies.