In November, the U.S. Labor Department’s diffusion index, which measures the breadth of industries expanding their payrolls, climbed to 69.7 - the highest level since January 1998. A level above 50 percent indicates more industries are hiring than firing.
“The labor market recovery is broadening out, and the diffusion index speaks to that,” Neil Dutta head of U.S. economics at Renaissance Macro Research LLC in New York said. “You have more people working, they’re working more hours and they’re earning more money.”
According to Dutta, broader job gains will accelerate improvement in the labor market, as more industries participate in the recovery. That should also incentivize faster gains in income growth, as employers compete for workers by bidding up wages.
The 321,000 advance in payrolls last month exceeded the most optimistic projection in a Bloomberg survey of economists and followed a 243,000 gain in October that was stronger than previously reported, figures from the Labor Department showed today in Washington. Average hourly earnings rose 0.4 percent from the month before, the most since June of last year.
Regarding particular industries, employment in business and professional services climbed by 86,000 last month, while payrolls at couriers and messenger services such as United Parcel Service Inc. rose by 4,700. Retail employment increased by 50,200 in November, the most this year, as companies increased headcount to prepare for the holiday shopping season. Payrolls rose by 28,000 at factories.
