NEW YORK • The United States added more jobs than forecast last month and the unemployment rate held at an almost 17-year low, though below-forecast wage gains suggested the labour market still has slack to absorb.
Payrolls rose 228,000, above the median economist estimate of 195,000, after a downwardly revised 244,000 advance, Labour Department figures showed yesterday. Average hourly earnings rose 2.5 per cent from a year earlier, less than the 2.7 per cent projection.
While the job market remains a bulwark for the economy and investors see a Federal Reserve interest rate hike next week as a near certainty, the lack of acceleration in wages could factor into the pace of increases next year.
Chief financial economist Ward McCarthy at Jefferies said: "We continue to march towards full employment. Wages are moving in the right direction but they are still slower than we would have liked, and certainly slower than what's expected at this stage of the cycle."
Average hourly earnings rose 0.2 per cent from the prior month following a revised 0.1 per cent drop. Analysts had pencilled in a gain of 0.3 per cent for last month.
The gain from a year earlier followed a downwardly revised 2.3 per cent advance for October.
Economists expect that in time, wages will post a sustained pickup, which has remained elusive in this expansion even though labour market slack is steadily disappearing. Faster wage gains would boost consumer spending, which accounts for about 70 per cent of the economy.
Mr Jerome Powell, President Donald Trump's nominee to head the Fed, said last month at his confirmation hearing that he does not see wages signalling any tightness in the labour market.