WASHINGTON — Discounters and department stores continued to boost payrolls during the critical holiday shopping season in November, while specialty stores cut back on employment following a strong wave of hiring in October, the monthly U.S. Labor Department report revealed Friday.
Department stores added a seasonally adjusted 500 jobs to payrolls to employ 1.32 million, while general merchandise stores, a category that includes discounters and department stores, boosted payrolls by 11,600 jobs last month. Apparel and accessories stores cut 14,200 jobs to employ 1.38 million.
“I’m a little concerned about specialty store because we had negatives numbers out there [prior to October] but we had a good-sized positive in October,” Hoyt said. “It bears watching but I think it’s too soon to worry too much.”
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Specialty stores added 14,700 jobs in October, which amounts to a two-month net gain of 500 jobs, he said.
Jack Kleinhenz, chief economist at the National Retail Federation, said the two-month trend for apparel and accessories store employment suggests that hiring took place earlier in October but might not have been supported by the anticipated increases in sales, which led to lay-offs in November.
“You’ve heard reports that winter wear might not have been moving as expected,” Kleinhenz said.
Department stores posted a third straight month of modest employment gains, Hoyt said, while general merchandise stores have been solidly adding jobs as well.
The two big weak spots in employment are manufacturing and mining, he said.
“Manufacturing is struggling both because inventories are high and because the dollar is high,” Hoyt said.
In manufacturing, employment in textile mills making apparel fabrics and yarns cut 200 jobs to employ 116,600, while employment at mills making home furnishings products cut 600 jobs to employ 114,800. Apparel manufacturers added 500 jobs to payrolls to employ 137,100.
In the broader economy, employers added 211,000 jobs, beating economists’ expectations, and the unemployment rate remained unchanged at 5 percent last month.
Nariman Behravesh, chief economist at IHS Global Insight, said the November jobs report was “solid.”
“For the past six months, average payroll increases have been over 200,000. The equally solid gains over the past two months in the Household Survey employment and labor force numbers are also encouraging,” Behravesh said. “While wage growth edged down a little in November, it was above the rate earlier in the year.”
IHS is forecasting solid job growth in the coming months, at a rate of about 180,000 jobs a month.
“Likewise, we expect that wage inflation will gradually begin to rise. All of this is consistent with a labor market that is beginning to tighten,” he noted “But with labor force participation at a four-decade low and with broader measures of unemployment still high, the residual slack in the labor market will limit the acceleration in wages for a while.”
As for the implications for the first Federal Reserve rate hike, Behravesh said the November jobs report was the “last hurdle” for the Fed to raise the rate this month. “The members of the FOMC [Federal Open Market Committee] can now take comfort that the soft jobs growth over the summer was temporary and that the US economy is on track for sustained sturdy growth,” he noted. “This realization, along with recent comments by Fed Chair [Janet] Yellen, mean that a rate hike at the December 15-16 Fed meeting is (almost) a sure thing.”