The Bureau of Labor Statistics (BLS) reported that the national unemployment rate fell from 9.0 percent in October to 8.6 percent in November, its lowest level since March 2009. There were 120,000 net new nonfarm payrolls for the month, including 2,000 new manufacturing jobs.
Manufacturers have added just 6,000 net new jobs since July; whereas from January 2010 to July 2011, they generated 302,000 in new employment. While there have been some indications that net employment in manufacturing will pick up especially as we move into the new year, it is clear that job growth in the sector has slowed down considerably in recent months.
Breaking this down between different manufacturing sectors, durable goods have done better of late than nondurables. In November, durable goods sectors added 10,000 net new jobs relative to the loss of 8,000 in employment from the nondurable goods industries.
The sectors with the fastest employment growth for the month were fabricated metal products (up 8,300), transportation equipment (up 5,200) and machinery (up 3,800). Industries losing the most jobs in November included computer and electronic products (down 3,400), food manufacturing (down 3,300), printing and related support activities (down 3,200) and miscellaneous manufacturing (down 3,000).
The average workweek edged slightly lower for manufacturers, from 40.5 hours in October to 40.3 hours in November. The average amount of overtime remained the same at 3.2 hours per week. Therefore, the average weekly earnings for manufacturing workers dipped declined from $967.55 to $958.33.
The good news in this report is the substantially lower unemployment rate, and the nonfarm payroll increase was in-line with most economists’ forecasts. Part of the decline in the unemployment rate could be explained by a reduction in the size of the labor force. For instance, the number of discouraged workers increased from 967,000 in October to 1,096,000 in November.
Still, the larger picture is an optimistic one. It would be nice to get the manufacturing jobs engine going again, with net job gains where they were prior to August. Nonetheless, there are signs of improvement in many areas of the economy – including manufacturing – which should spill over into a better 2012.
Chad Moutray is chief economist, National Association of Manufacturers.