STORY: The U.S. Labor Department's closely watched jobs report on Friday showed employers hired more workers than expected in November, adding 263,000 jobs even as layoffs in the tech industry made headlines last month.
The continued strength in the U.S. labor market comes despite mounting worries of a recession and in the face of steep interest rate hikes from the Federal Reserve as it battles high inflation.
Daniel Zhao is lead economist at Glassdoor.
"We are still seeing that employers are hiring, even though there have been prominent reports of layoffs and hiring freezes. Overall, we are still seeing job gains, especially in wages, in hospitality and health care... we know that there are some headwinds facing the American economy and there are concerns about a recession, especially in 2023. But the signals that we're getting from the job market, this doesn't look like a job market that is about to tip into recession. Overall, things still do look healthy there. Even though things are clearly cooling, they are clearly decelerating. The job market is still a bright spot for the economy."
The unemployment rate held steady at 3.7% and Friday's report also showed an unexpected jump in average hourly earnings.
Zhao said the jump in wages might be a speed bump for the Fed but won't alter the course in its drive to bring down inflation.
"I think the Fed looks at today's report and it doesn't really change their perspective about what the trajectory of the job market looks like. We did see wage growth tock up a little bit in November and that might be a speed bump on the Fed's path towards a soft landing. But, overall, they still see a job market that is resilient in the near term but is decelerating. So, ultimately, what the Fed is watching for is to see inflation start to come down while the job market is still resilient and can withstand that tiger monetary policy."
Wall Street's main indexes opened lower on Friday as the jobs report disappointed investors who have been worried about aggressive interest rate hikes by the Fed. But stocks had recovered some early losses by midday.