December 2, 2022
263,000 jobs were added in November… the unemployment rate remains extremely low and wages keep going up.
I’m going to tell you why that’s a good thing – but also problematic for inflation.
First, today’s jobs report found as I said 263,000 jobs were added in November. Where? In places like leisure and hospitality, health care and government.
The unemployment rate remains really low and steady at 3.7%. Wages inched up too…more than 5% higher than a year ago.
All that is good for workers and shows despite really high inflation and the federal reserve jacking up interest rates, the jobs economy is strong and pretty resilient.
But you wanna know what else is resilient? Inflation. And these numbers show inflation going to be sticking around longer than anyone thought.
See, all these strong numbers are fueling the inflation vicious cycle. People have more money to spend, so that pumps money into the economy and prices go up. The only way to break the cycle… is for The Fed to keep raising interest rates and making it more expensive to borrow money so people and businesses stop spending and start pulling money out of circulation. The Fed’s mission is to keep unemployment low – which we have and inflation at 2% …which we don’t have. Inflation is at 7.7%.
Today’s strong jobs report along with the strong consumer spending report I told you about in this video yesterday, proves that this inflation is stubborn. It’s not coming down as fast as the Federal Reserve had hoped and that likely means they’ll have to keep steadily increasing interest rates for longer than they first thought. Their next rate hike is coming in less than two weeks.
Read the November jobs report here.
