Jobs Data Disappoints: Unemployment Rises To Over 4-Year Highs

The U.S. labor market showed clearer signs of cooling in November, as job growth met already subdued expectations while the unemployment rate rose more than anticipated, intensifying concerns that the slowdown is becoming more fragile.

Nonfarm payrolls increased by 64,000 in November, only slightly above the 50,000 jobs expected by economists, but still well below levels typically associated with a healthy pace of job creation, the Bureau of Labor Statistics reported Tuesday.

Private-sector hiring remained a bright spot, with 69,000 private payrolls added, comfortably above expectations of 40,000.

That strength, however, was offset by a 5,000 decline in government employment, which continued to weigh on the headline number following shutdown-related distortions earlier in the fall.

The unemployment rate rose unexpectedly to 4.6%, up from 4.4% in September, marking its highest level since September 2021 and signaling further easing in labor market tightness.

Wage growth also softened. Average hourly earnings rose just 0.1% month-over-month, missing the 0.3% forecast, while the year-over-year pace slowed to 3.7%, down from 3.8% in October.

October payrolls fell by 105,000, reversing September's 108,000 gain, largely due to 157,000 job losses in the government sector, even as private payrolls rose by 52,000.

The Bureau of Labor Statistics also revised prior data lower. August payrolls were revised down by 22,000, from a negative 4,000 to a negative 26,000, while September payrolls were revised down by 11,000, from 119,000 to 108,000.

The cooler labor market reading may push traders to reconsider how long the Federal Reserve can afford to stay on hold.

Prior to the data, markets were pricing only a 25% probability of a fourth consecutive 25-basis-point rate cut in January 2026, as Fed Chair Jerome Powell recently underscored that policymakers are "well positioned" to wait for clearer signals.

However, the ongoing deterioration in labor conditions could begin to strain that patience.

This is a developing story…

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