Q&A: What does the November jobs report mean for workers and the economy?

UNIVERSITY PARK, Pa. — The U.S. Bureau of Labor Statistics released its November jobs report on Tuesday (Dec. 16), which details economic indicators like payroll numbers and the unemployment rate. The Federal Reserve uses the report to help set monetary policy, like influencing interest rates, while industry uses the report to inform business decisions like strategic planning, capital equipment spending, and hiring and layoffs.

Lonnie Golden, professor of economics and labor-human resources at Penn State Abington, explained in the Q&A below what the report means for the economy and American workers.

Q: What are the main takeaways from the November jobs report?

Golden: The report that came out this week summarizes the last couple months of the state of the job market, and it revealed some interesting but troublesome trends. We find that the labor market is still moving forward, but it’s kind of stuck in first gear. Payrolls added 64,000 new jobs last month, but that’s after a loss of 105,000 jobs in October and revisions downward to the summer months’ job creation numbers. There's been a slight increase in the rate of unemployment from 4.4% in September to 4.6% in November and 4% at the start of the year, particularly concentrated among the youngest workers.

Another indicator revealed in the labor force and employment report is a jump in what we call underemployment, as indicated by the percentage of the workforce that is working part-time hours but would prefer full-time jobs. The number of underemployed workers spiked up in the last month and has risen by over a million individuals in the last year. Together, underemployed and unemployed individuals now comprise 8.7% of the labor force, up from 8% last month

The job growth that did occur in November is mostly concentrated among the health care, social assistance and construction sectors, partly offsetting the decline in transportation and warehousing and especially federal government employment. Unemployment jumped for agricultural, sales and professional jobs over the last year.

A final key takeaway in the latest report is a jump in the percentage of people that are holding multiple jobs. That increased from 5.4% in September to 5.8% in November. This rate is the highest since the end of 1999, and it represents over 9 million people — the highest number on record.

The Federal Reserve sort of anticipated this report in their last meeting and, by a 9 to 3 vote, decided to reduce their interest rates. The Fed will soon decide whether to reduce rates a little more in 2026 or leave them as is. They have to navigate between potentially reigniting inflation and reinforcing the recent reductions if they are not generating stronger job creation and reduced unemployment and underemployment.

Q: What does the report reveal about the state of the American economy?

Golden: As an economist who watches the labor market in particular, I think the report suggests that the labor market is not as strong as it was last year or the year before, but it's not yet going into a recession. We are seeing some indicators that some people are hedging against potential layoffs by taking multiple jobs or are wanting to work full time rather than part time because they're anticipating perhaps reductions in job opportunities or in their income.

It's also showing that weekly earnings are still increasing, with average hourly earnings $1.25 higher than this time last year. That might bode well for affordability issues since the labor market is still generating some wage gains that are keeping up with inflation. But it's concerning that there seem to be some areas of growing job insecurity, and that concern is well-founded based on the slowing job growth rate and the increase in people holding more than one job.

Q: What does the report mean for American workers? How can they use the monthly data to make household decisions? 

Golden: The average citizen at home, as part of a household or as part of the labor market, is always in a situation of uncertainty. That might be intensified now because of the adoption of technologies that might put many jobs at risk of being replaced wholesale, although for other jobs it may complement or assist our productivity or just change which tasks we do. Many people are legitimately uneasy about the effects of adopting artificial intelligence technology and other types of automation. And we're worried about this uptick in unemployment for job availability. We're worried about the potential for greater job loss that will contribute to spreading unemployment. For the time being, we should be assured that the rapid spread of such technology is not resulting, at least immediately, in any cuts to work hours or pay, so households may still have the wherewithal to continue spending at current levels.

Having said that, the concern that I have about the growth in underemployment, and maybe relatedly the growth in multiple job holding, speaks to that uncertainty that could drive the labor market further down into neutral or reverse gear.