US job losses mount as unemployment hits highest level since 2021

The US economy shed a net 41,000 jobs across October and November, while the unemployment rate climbed to its highest level in nearly four years, signalling a cooling labour market amid trade tensions, immigration curbs and broader economic uncertainty.

According to data released on Tuesday by the Department of Labor’s Bureau of Labor Statistics, the economy added 64,000 jobs in November after losing 105,000 in October. The unemployment rate rose to 4.6 percent, up from 4.4 percent in September.

October’s data was distorted by a government shutdown that limited the collection of key economic indicators, including the unemployment rate for that month. Job losses in October were driven largely by the federal government, where 162,000 workers lost their positions after deferred contract buyouts expired at the end of September. A further 6,000 government jobs were cut in November.

Private-sector hiring remained uneven. Healthcare led job gains in November, adding 46,000 positions, above its 12-month monthly average of 39,000. Construction added 28,000 jobs, in line with recent trends, while social assistance rose by 18,000.

Other sectors continued to contract. Transportation and warehousing lost 18,000 jobs, while manufacturing shed 5,000 positions in November after losses of 9,000 in October and 5,000 in September, extending a steady downward trend.

White House economic adviser Kevin Hassett sought to strike an optimistic note, telling reporters to expect more manufacturing jobs within the next six months, citing strong construction hiring and increased manufacturing investment as leading indicators.

But signs of strain are growing elsewhere in the labour market. The number of people working part time for economic reasons rose to 5.5 million, an increase of 909,000 since September.

Critics say the data undercuts the administration’s economic narrative.

The report follows the Federal Reserve’s decision last week to cut its benchmark interest rate by 25 basis points to a range of 3.5 to 3.75 percent, citing easing labour market conditions.

“The labour market has continued to cool gradually, … a touch more gradually than we thought,” Fed Chair Jerome Powell said after the rate decision.

Markets reacted cautiously to the figures. By midday trading on Tuesday, the Nasdaq was down 0.4 percent, the S&P 500 had fallen 0.5 percent, and the Dow Jones Industrial Average was trading 0.4 percent below its opening level.