MNI DATA PREVIEW: US Payrolls May See Fastest Gain in 7 Months

Survey Has November Jobs +185k; Private +178k

By Brooke Migdon and Ryan Hauser

     WASHINGTON (MNI) - U.S. employment growth likely accelerated at the fastest

pace in seven months in November as a General Motors autoworkers strike ended.

     Non-farm payrolls climbed by 185,000 according to a Bloomberg survey median

compared with October's 128,000 gain. The unemployment rate is expected to hold

at 3.6%, close to a record low of 3.5% recorded in September.

     November job growth will likely reflect gains in service-sector employment

and a rebound in manufacturing payrolls following the 40-day GM-UAW strike that

ended Oct. 25. Durable goods and motor vehicle and parts payrolls both fell by

41,000 in October because of the strike.

     Manufacturing employment grew at the fastest pace since March according to

the IHS Markit Manufacturing PMI. But the ISM Manufacturing PMI, which declined

0.2 percentage points in November, registered a 1.1 percentage-point drop in its

employment sub-index, marking the fourth consecutive contraction and adding some

uncertainty to Friday's report.

     Fed officials have cited labor market strength while signaling they are

done cutting interest rates after three reductions this year aimed at blunting

damage to manufacturing and investment from trade disputes. At the same time,

the combination of modest wage growth and low unemployment has allowed the Fed

to keep rates lower than in the past without sparking inflation.

     Private payrolls are also expected to rebound in November, with Bloomberg

forecasting a 178,000 increase after October's sluggish 131,000 pace. However,

the ADP employment report released Wednesday indicated slower and more

disappointing growth in November, tracking private sector job gains at 67,000

when Bloomberg expected a 160,000 increase.

     The U.S. service sector also continues to grow. The non-manufacturing

sector expanded in November, continuing an almost ten-year streak, according to

the November ISM Non-Manufacturing report. IHS Markit's U.S. Services Business

Activity Index also increased to 51.6 in November from 50.6 in October.

     One sign of weakness is slowing consumer confidence. The Conference Board's

measure fell for the fourth consecutive month in November, falling to 125.5 from

126.1 in October.

--MNI Washington Bureau; +1 202 371 2121; email: brooke.migdon@marketnews.com

--MNI Washington Bureau; +86 (10) 8532-5998; email: archie.zhang@marketnews.com

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