These Are the Best Jobs Numbers in Months, Maybe Years

Merry Christmas and Happy Hanukkah from your friends at the Bureau of Labor Statistics.

The November jobs numbers from the federal agency, released Friday morning, are the best all-around news about the state of the American economy in months, and maybe years. Indeed, it is in the details of what make this report a good one that you find evidence for momentum in the economy.

In short, for the last couple of years, there has been great progress in reducing the unemployment rate, but it was accomplished in part because people left the job market, and it was not accompanied by any meaningful gains in wages.

There have been anecdotal hints for months that employers are facing new pressure to raise workers' wages as the job market has gotten tighter. And Friday's report is the first piece of real evidence in the official government data that it's happening.

In November, the unemployment rate was unchanged at 5.8 percent, but almost all the other measures of the labor market pointed to an improving composition of the job market: Employers added more positions, and at higher hourly wages. If the November trend is sustained, the unemployment rate may not fall much in the months ahead, but Americans will be a lot happier.

The numbers are these: The 321,000 payroll jobs added represent the best monthly result since January 2012. Revisions to September and October counts add a net 44,000 positions, boosting those months' results from 'solid' to 'pretty good.'

Over the last three months the nation has added an average of 278,000 jobs a month, the best result since the 2008 recession except for a brief boom caused by census hiring in 2010.

But what was warming the hearts of many jaded economy-watchers on Twitter Friday morning were the numbers on wages.

Average hourly wages rose 0.4 percent, and the average length of the workweek for private-sector workers ticked up to 34.6 hours, from 34.5. Add it all up, and an index of weekly payrolls rose a whopping 0.9 percent in November, which is the kind of monthly swing that rarely happens.

The usual caveats have to come into play here. It's one month. It will be revised multiple times. There is a wide error band around these numbers, and all this may turn out to be an aberration. Average hourly earnings are still up only 2.1 percent over a year earlier, just barely faster than inflation.

And, lest we get too cheery, it's worth at least pointing out a weaker spot in the report. The survey of households on which the unemployment rate is based painted a more stagnant picture of the economic situation, with the proportion of the population in the labor force and the proportion of the population with a job both unchanged.

It will take many more months of above-trend gains in hourly wages to conclude that workers are finally starting to accrue the benefits of an expansion that is in its sixth year. But the November data is a nice start that should make people feel better about the state of the economy heading into 2015.