dodepress hiringthe fiscal cliff
WASHINGTON, DC-The Bureau of Labor Statistics reported Friday morning that total nonfarm payroll employment rose by 146,000 for the month November, and the unemployment rate inched down down to 7.7%. Sectors that saw increases in employment included retail trade, professional and business services and health care.
These figures had been particularly dreaded as it was thought that Superstorm Sandy would have a negative impact on employment. However, the Labor Department said that its survey response rates in the affected states were within normal ranges: “Our analysis suggests that Hurricane Sandy did not substantively impact the national employment and unemployment estimates for November.”
Other seasonal trends, though, were apparent in the numbers—retail for example, not surprisingly given it is the holiday season—saw a big jump in employment. Retail trade employment rose by 53,000 in November increasing by 140,000 over the past three months. Employment in professional and business services rose by 43,000 and in health care employment by 20,000. Health care has added an average of 26,000 jobs per month this year, Labor said.
The construction sector, however, posted a drop of 20,000 jobs for the month, while the industry’s unemployment rate hit 12.2%, according to an analysis of the data released by the Associated General Contractors of America. The association makes little bones about its belief that uncertainty due to the fiscal cliff is a primary reason. “As disappointing as these numbers are, they will only get worse if Congress and the White House allow huge tax increases and spending cuts to occur on January 1,” says Ken Simonson, the association’s chief economist.
Fifty-four percent of firms surveyed by the association last month reported the threat of tax hikes has forced them to adjust their business plans. Among those firms, 67% reported postponing hiring, 65% reported delaying or cancelling capital expenditures and 32% reported having already made layoffs. If tax rates do increase, nearly two-thirds of firms (63%) that haven’t already acted say they will change their business plans next year.
Nearly 70% of firms participating in the survey report they pay under the individual tax rate. Because most are small, with staff numbering under 50, they have little capacity to absorb additional costs, association officisals say.