U.S. Economy Sees Significant Jump in Jobs

Employers added 215,000 payroll jobs in November, while unemployment remained steady at 5 percent. The job gains follow other recent positive economic news in the wake of the Gulf hurricanes: strong third-quarter growth, a rebound in consumer confidence and a stock-market rally.

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The country's job market has bounced back after hurricanes knocked hundreds of thousands of people out of work this fall. The Labor Department reports that 215,000 jobs were created in November. As NPR's Frank Langfitt reports, economists attribute the jump to the overall health of the US economy and the beginning of recovery on the Gulf Coast.

FRANK LANGFITT reporting:

In September and October, national employment growth was lousy, averaging just 30,000 jobs. But strong numbers last month suggest that Hurricanes Katrina and Rita didn't do any lasting damage to the country's labor market. Stuart Hoffman is chief economist at PNC Financial Services in Pittsburgh.

Mr. STUART HOFFMAN (Chief Economist, PNC Financial Services): November shows there's some rebound specifically in those hurricane-disrupted regions. And in the rest of the country, they're actually back on track with job growth, especially now that gasoline prices have retreated to levels actually well below where they were when Katrina first hit.

LANGFITT: Speaking from the Rose Garden, President Bush pointed to unemployment figures from today's report as a sign of a strong economy.

President GEORGE W. BUSH: The unemployment rate is 5 percent, and that's lower than the average for the 1970s, 1980s and 1990s.

LANGFITT: Some of last month's biggest employment gains came in construction, where cleanup along the Gulf Coast helped produce 37,000 new jobs. Even manufacturing, one of the labor market's weakest sectors, grew by 11,000 jobs; that's the second increase in two months. Stuart Hoffman of PNC Financial says that may be partly driven by demand for cement, plywood and other construction materials along the Gulf Coast.

Mr. HOFFMAN: It does appear that manufacturing orders were doing better, but some of that was probably related to the need to rebuild in the Southeast and maybe not a sustained upturn.

LANGFITT: Other economists say the recent rise in manufacturing masks a fundamental trend in the job market. John Silvia, chief economist at Wachovia, says the report shows how American jobs have shifted from manufacturing to the service sector. For instance, unemployment for production workers was 6.3 percent last month, three times what it was for professionals.

Mr. JOHN SILVIA (Chief Economist, Wachovia): I think the unemployment rate disparities between productional workers and management professional workers is absolutely the key. Listen, the issue is structural unemployment; it isn't the business cycle. We've got good economic growth. It's just that these jobs are not going to come along with that growth.

LANGFITT: Despite the uptick in the last couple of months, Silvia says manufacturing employment will continue to struggle because companies have so many choices in what is now a worldwide labor market.

Mr. SILVIA: There is a reallocation of jobs around the globe, and it's not simply taking US jobs and moving them abroad. It's simply that as a company looks to create new jobs, they're going to look at the US as just one other place to put those jobs. And unfortunately, what's happened is we expect that these manufacturing jobs are suddenly going to reappear as the economic cycle matures, and that simply hasn't happened for three years.

LANGFITT: The November job report also showed growth in other sectors, including finance, health care and food services. Frank Langfitt, NPR News, Washington.

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