Work Kermitments

Kermit hammering an American typewriter

Image source:

What's going on?

Data out Friday showed that the US economy added 266,000 jobs in November beating investors expectations by 45% and capping off a very cheery week. Sheesh!

What does this mean?

Everyone expected the US to add more jobs in November than October, when numbers were driven down by a massive strike at General Motors. But almost no one expected things to be this good. Whats more, Octobers numbers were revised up the US actually added 28,000 more jobs than previously thought. All thats brought the unemployment rate back down to 3.5%, its lowest in 50 years.


China also lifted tariffs on some US soybean and pork imports on Friday indicating that a resolution to the trade war may be in store. Taken together, investors fears of an economic slowdown have been significantly assuaged: they duly sold off safe-haven investments like government bonds in favor of stocks.

Why should I care?

For markets: The Federal Reserve isnt sold just yet.

Novembers US employment data also revealed that wages grew 3.1% compared to 2018. That, combined with buoyant consumer sentiment, suggests that the US is in for a good holiday season: people have money, and theyre ready and willing to spend it (tweet this). For now, however, that hasnt fed through to inflation the US central banks other main concern. Its therefore likely to keep interest rates steady when it meets later this month. If fatter wallets eventually lead to higher prices, however, a rate hike could be on the horizon.



For you personally: Uh-oh.

As wages creep up and unemployment falls, employers struggling to hire new people could turn elsewhere. While automation isnt always cost-effective when wages are low, it might soon get more attractive for some. That could become a problem for those in easily automated jobs although by improving productivity, it could also boost the economy overall.

Originally posted as part of the Finimize daily email.

The top 2 financial news stories in 3 minutes. Join over one million Finimizers

Read next

Roll Back The Barrel

Sign up to Finimize

Get the two most important global financial news stories each day. Sent at midnight UK time.

Get started with one email a day

The top financial news stories in 3 minutes.