U.S. employers added 64,000 jobs in November, after payrolls fell by 105,000 in October, the government reported in releases that arrived late because a 43-day federal government shutdown delayed key labor-market data. The unemployment rate rose to 4.6%, the highest since 2021, up from 4.4% in September; no October unemployment rate was published because the shutdown disrupted the household survey used for that measure.
The November gain was above economists’ forecast of about 40,000 jobs, but revisions to earlier data were less supportive. The Labor Department reduced previously reported payroll totals by a combined 33,000 jobs for August and September. Hiring momentum has also eased: since March, job growth has averaged about 35,000 a month, down from roughly 71,000 in the year that ended in March, as employers weigh policy uncertainty and the lingering effects of the high interest rates the Fed set in 2022 and 2023 to curb inflation.
Federal Workforce Cuts Add Volatility to Payrolls
A steep decline in federal employment dominated October’s headline loss. Federal payrolls dropped by 162,000, with many workers leaving at the end of fiscal 2025 on Sept. 30 as part of an effort to shrink the government workforce that the report described as tied to billionaire Elon Musk’s push to cut federal payrolls.
Administration officials said the higher unemployment rate may be picking up former federal employees who are now searching for work. Kevin Hassett, director of the White House National Economic Council, said “the 250,000 federal government workers who took the buyout” are likely staying in the labor force and looking for jobs, and are therefore counted as unemployed until they find new positions. The report showed the labor force rising by 323,000 from September.
The shutdown also complicated interpretation by pushing multiple releases off schedule. The Labor Department issued the September jobs report on Nov. 20, seven weeks late, and published some October payroll information alongside the November report. Reuters reported that the shutdown increased uncertainty in the household survey, making the unemployment rate harder to read even as payroll growth improved in November.
Fed Debate Sharpens as Wages and Sectors Cool
The delayed data reached markets as the Federal Reserve debated the path of interest rates. Concern about the job market helped prompt a 0.25 percentage point cut last week, the Fed’s third reduction this year, but three officials dissented, the most in six years. Two voted to hold rates steady while inflation remains above the Fed’s 2% target. Stephen Miran, appointed by President Donald Trump to the Fed’s governing board in September, voted for a bigger cut, in line with what the president has demanded.
Fed Chair Jerome Powell said the central bank believes hiring has been overcounted by about 60,000 jobs per month since spring, suggesting future revisions could show a softer trend than earlier data implied. Samuel Tombs of Pantheon Macroeconomics wrote that deterioration has likely been too gradual to force another cut at the Fed’s Jan. 27-28 meeting.
Pay gains have slowed. Average hourly earnings rose 0.1% from October, the smallest monthly gain since August 2023, and were up 3.5% from a year earlier, the slowest annual pace since May 2021. In November, health care added more than 46,000 jobs and accounted for more than two-thirds of the 69,000 private-sector jobs created; construction added 28,000. Manufacturing lost 5,000 jobs, the seventh straight month of declines.
The report also pointed to technology as a factor affecting labor demand, citing wider use of artificial intelligence and related automation. In eastern Pennsylvania’s Lehigh Valley, staffing executive Matt Hobbie said logistics and transportation hiring has cooled as automation and robotics spread.
For jobseekers, the slower pace can translate into long searches and fewer responses. Amy Beckrich, 54, of Farmington, Minnesota, said she lost her human-resources job in May, has applied for more than 100 positions, and has struggled to secure interviews; her unemployment benefits expired this month as her household cut spending.
