The November 2021 employment report was a mixed bag between disappointing jobs growth and a solid drop in the unemployment rate.
But despite the perplexing headline numbers, most sectors in the U.S. economy added to their payrolls last month with professional and business services leading the gains.
That industry added some 90,000 jobs in November, thanks to strong hiring for business consultants (12,000), accountants (7,600) and building service workers (10,400) like janitors, landscapers and pest exterminators.
Transportation and warehousing also posted a strong November with a gain of 49,700 jobs as millions of Americans shopped online just ahead of the holiday season. Couriers and messengers, workers who pick up and deliver packages and mail, saw employment pop by 26,800 last month while warehousing and storage facilities added 8,800.
Food manufacturers, which transform commodities like sugar cane and livestock into ready-to-consume products, helped lead the broader manufacturing sector higher in November with a gain of 7,400 positions. The entire manufacturing industry added 31,000 jobs last month.
Construction also added 31,000 in November, thanks to broad-based hiring. Building construction workers, civil engineers and specialty trade contractors all saw employment increases last month.
While the November report continued to show strong demand among American consumers for goods, the service side of the economy posted a more mixed picture.
The leisure and hospitality sector, which tends to rise and fall based on the prevalence and severity of Covid-19 cases, added 23,000 last month. That comes in stark contrast to the gain of 170,000 payrolls the sector saw in October and the 108,000 from September.
Leisure and hospitality has added 2.4 million jobs thus far in 2021, but employment in the industry is down by 1.3 million, or 7.9%, since February 2020.
Retail, which often sees an uptick in hiring in the two months leading up to the holiday season, actually lost jobs. The industry posted a net loss of more than 20,000 positions last month with notable losses at clothing stores (a decline of 17,700) and department stores (a drop of 7,500).
It’s unlikely that the advent of the omicron variant had a significant impact on those sectors given the few number of cases reported in the U.S. to date.
Some economists suggested the deceleration in leisure and hospitality is likely to result of the tight labor market and newfound earnings power among cooks, wait staff and other restaurant workers.
“Wage growth was especially strong in leisure/hospitality services and retail trade, indicating that the tight labor market for these workers is leading firms to increase pay,” wrote Gus Faucher, chief economist at PNC Financial.
Wage growth was especially strong in the leisure and hospitality sector. While average hourly earnings for all private payrolls rose 0.26% from October to November, workers in the leisure and hospitality sector saw their hourly wage rise 0.84%.
— CNBC’s Nate Rattner contributed reporting.
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