(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

No major announcements

Employers continued to add jobs in November amid signs of a weakening labor market, including the highest unemployment rate in four years. The shutdown-delayed employment report from the Bureau of Labor Statistics showed 64,000 more jobs in November after a 105,000-job decline in October, the third drop in five months. Federal jobs led the October fall as total employment stayed flat since April. Temporary help — considered a harbinger of hiring trends — reached its lowest level outside of the pandemic since 2012, amid recovery from the Great Recession. Because of the 43-day government shutdown, household data was not collected in October and had a higher margin of error in November. That data raised the seasonally adjusted unemployment rate rose to 4.6% in November, the highest since September 2021.

The Commerce Department reported no change in retail sales in October. Eight of 13 major categories had higher sales. Decliners were led by car dealers, home-and-garden centers and bars and restaurants. Sales fell at gas stations because of lower prices. Excluding volatile car and gas sales, retailers generated 0.5 % more revenue than in September. About two-thirds of U.S. economic activity is driven by consumer spending, a majority of which is reflected in retail sales.

No major announcements

The broadest measure of inflation showed a 2.7% annual pace in November. Because of the shutdown, the Bureau of Labor Statistics skipped its October report, the first miss  since 1948, but showed a lower Consumer Price Index increase for the first time since April, when the year-to-year rate was 2.3%. Inflation stayed above the long-range Federal Reserve target of 2% but was down from a four-decade high of 9.1% in June 2022. According to the incomplete report, gas prices were up 11% from the year before and shelter costs rose 3%. Excluding volatile costs for energy and food, the core CPI rose 2.6% from November 2024.

The four-week moving average for initial unemployment claims rose for the second week in a row, the Labor Department reported. The gauge of employers’ willingness to release workers was 40% below the long-term average and up 5% from the low just before the COVID-19 pandemic. Total jobless claims rose nearly 16% in the latest week to just below 2 million, up almost 2% from the year before.

Existing home sales rose 0.5% in November, a third consecutive increase, the National Association of Realtors reported. The annual sales rate of 4.1 million houses and condos was 1% below the year before; 2024 had the lowest sales in 30 years. An economist for the trade association said housing wealth was at an all-time high, so homeowners are in no hurry to list their properties. Low inventory has helped boost prices, rising to a median price of $409,200 in November, a 1.2% gain from the year before and the 29th consecutive increase.

The University of Michigan’s consumer sentiment index rose marginally in December, though it was 28.5% lower than the year before. Conditions for buying durable goods fell for the fifth month in a row as 63% of consumers surveyed foresaw a continuing rise in unemployment. Inflation expectations fell but remained higher than they were in January. Economists follow consumer sentiment as a leading indicator of consumer spending.