A dditional strength was evident in the measures of existing employment. The average workweek increased by a tenth of an hour. Average hourly wages also increased, rising $0.9. Annualized, this doubles the 2.1% rate of wage increase recorded over the past year.
US Jobs Report Beats Forecasts Big Time
Lots to Like in the November Numbers
The November BLS Employment Situation Release was a welcome surprise. The 321,000 new jobs far exceeded expectations, handily beating the average of 224,000 over the prior 12 months. The new job creation numbers for September and October were revised upward 15,000 and 29,000, respectively. Unemployment, which is measured by a separate survey, remained unchanged at 5.8%. The participation rate was also flat at 62.8%.
New Jobs Creation: Widespread and Robust
Most industry categories reported substantial job creation. Professional and Business Services, of which Temporary Employment is a subset, added 86,000 jobs. Health Services, Manufacturing, Construction, and Financial Services all saw substantial employment growth. Industry segments with a seasonal influence, including Retail, Leisure and Hospitality, and Transportation and Warehousing, all contributed to the strong new job creation total.
Temporary Agency Employment – More Growth, More Records
Temporary agency employment has set a new record high each month for more than two years. Even in a month with a marked rise in overall employment like November, reliance on contingent labor continues to increase as a percentage of overall employment. Temporary jobs as a percentage of total nonfarm employment reached 2.12% this month, a new record. The trend established early during the employment recovery has become a long-term feature of the labor market: industry is increasing its reliance on non-traditional employment relationships.
Temp Labor – Upward Revisions
The October revisions to temporary employment estimates were downward, an exception to the general direction in 2014. November got the trend back on track, bumping up the temporary labor employment estimates for September and October.
The November job numbers were surprisingly robust. Commentators perhaps got a little carried away by the favorable values for new jobs, hours worked and wages. A single point does not make a trend. The potential exists that this encouraging report was a statistical or seasonal anomaly. If November does in fact signal a continuing acceleration in job creation, this has long-term implications for consumers of contingent labor. The IQNdex has shown little upward pressure on contingent labor bill rates over the past year. Increased demand for labor, together with non-market factors such as ACA and minimum-wage increases, may require employers to anticipate greater pressure on pay and bill rates in 2015.