US economy held back by a lack of willing workers

Headline US jobs numbers were weak, but the details paint a more positive picture. Nonetheless, labour supply simply isn’t returning quickly enough and for companies desperate to hire this is a huge problem. The implication is that it constrains growth and pay is bid higher, with those cost increases likely passed onto consumers.

Payrolls bad

US non-farm payrolls rose at a much slower pace than expected in November. 210,000 jobs were added last month – less than half of the 550k consensus. 82k upward revisions don’t really change anything. Goods producing jobs rose a solid 60,000, but there was a major slowdown in the service sector with just 175,000 private service sector jobs added. Leisure and hospitality is simply not rebounding as we would have liked to see (+23,000) while government employment fell for the fourth month in a row. Retail also saw a 20,000 fall. This means that US employment is still 3.9mn below pre-Covid…

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