Payroll Gains Beat Expectations, but the Pace Is Slowing

Total nonfarm payrolls posted a 263,000 gain in November versus a 284,000 rise in October (revised up by 23,000), while September had an increase of 269,000 (revised down by 46,000). The November result easily beat the consensus expectation of 200,000. However, the gain is still the slowest since April 2021.

Excluding the government sector, private payrolls posted a gain of 221,000 in November following the addition of a net 248,000 jobs in October. The average monthly gain over the 23 months since January 2021 was 449,000. However, the monthly increases appear to be slowing. Over the 14 months from January 2021 through February 2022, the average monthly rise was 535,000; for the five months from March 2022 through July 2022, the average was 376,000; and over the last four months, the average has dropped to 239,000 (see first chart). Despite beating expectations, the trend in payroll gains is slowing.