Financial Professionals


U.S. Labor Report: Not Actionable


This morning’s U.S. Labor report for November is a positive surprise on the surface. Most of the components are well ahead of consensus estimates.

  • November nonfarm payrolls rose 146,000 (Figure 1.1)
  • November private payrolls rose 147,000 (Figure 1.2)
  • Unemployment rate fell to 7.746% from 7.876% the previous month


  • Manufacturing payrolls fell 7,000
  • Government payrolls fell 1,000
  • Construction payrolls fell 20,000
  • The underemployment rate fell to 14.4% from 14.6%
  • The participation rate fell to 63.6% from 63.8% last month
  • The average work week was unchanged at 34.4 hours
  • October nonfarm payrolls were revised lower from +171,000 to +138,000
  • October private payrolls were revised higher from +184,000 to +189,000



  • “Sandy did not substantively impact the data.”
  • The number of households polled for the survey was 369,000 less this month due to bad weather preventing their presence at work.  The average for November over the last 10 years is 70,000.
  • “Rates of responses to its surveys were within normal ranges.”
  • Due to an earlier Thanksgiving holiday, the survey was conducted one week earlier than normal.


COMMENTARY: Collectively, the report will be viewed on Main Street as positive. Hopefully, over the next few months further positive labor figures support a potential positive trend. However, for investors this report is too noisy to be actionable within the capital markets.


Keep in mind, just two days ago, ADP cited Sandy “as wreaking havoc on the job market in November.”  Lastly, if this report did suggest that results should be taken as “market actionable,” would not the 10-year U.S. Treasury be experiencing more of a rise in yield than the modest 3 basis points of movement we’ve seen this morning?


Dismiss the noise, it’s all about the fiscal cliff and the current obstructionist ideology.


Figure 1.1 U.S. Nonfarm Payrolls – Prior 12 Months +157,000 Average


Source: Bloomberg


Figure 1.2 U.S. Private Payrolls – Prior 12 Months +162,000 Average


Source: Bloomberg


Figure 1.3 U.S. 10-Year Treasury Year To Date


Source: Bloomberg


Past performance is not a guarantee of future results.

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