In this week’s Line— our last post of 2025— we celebrate the return of timely government data, with the latest on jobs and inflation.
Employment Rose by 64,000 in November
Here’s the breakdown on the BLS report:
- The 64,000 increase in jobs last month was higher than the 45,000 Dow Jones forecast.
- October’s data—which was released for the first time—showed a 105,000 decline in employment, while data for August and September were revised downward by 33,000.
- The unemployment rate rose to 4.6%, due to a 323,000 increase in the labor force since September.
- Wages are up 3.5% compared to a year ago.
While the higher-than-expected gain in jobs last month sounds great, when you add in the big decline in October and the downward revisions to August and September, you basically get a loss of 74,000 jobs since August.
You may remember that the ADP November private-sector employment report found a decline of 32,000 jobs. Compare that to the BLS’s report, which had private sector employment up by 69,000 last month. Who’s right? Your guess is as good as mine, but if I had to bet, I’d go with ADP as who knows how the BLS November report might have been impacted by a rush to catch up with data collection.
You may also remember that we were expecting a big decline in federal government employment in October, due to the end of severance packages from deferred resignations. Unfortunately, we were right as federal employment fell by 162,000 in October and is down by 271,000 since January.
To sum up, while the headline says hiring was better than expected in November, the more you look at the details the more concerned you’ll be about the labor market in the coming months.
Inflation Lower Than Expected Last Month
Now there’s a headline we can all get excited about. The consumer price index was 0.2% higher in November than September, and was 2.7% above last year’s level. Since the BLS didn’t collect data for October, we do not have a monthly increase, just increases from September. Economists had expected a 0.3% increase from September and a 3.1% annual increase, so this data is much better than expected.
The core CPI figure, which excludes food and energy prices, was 2.6% higher than November 2024, and below the 3% forecast. As many of you know, the Fed pays the most attention to this number as food and energy prices can be very volatile.
Like the jobs report, we must view the CPI data with a bit of caution, especially since there is no data from October to make a monthly comparison. That said, it does look like inflation is slowly moving in the right direction which would increase the chance of a Fed rate cut in January.
Have a great holiday season, see you in 2026.
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