US Unemployment Jumps to 4.6% — Highest Since 2021 as Job Growth Slows

The US unemployment rate rose to 4.6% in November, the highest level since September 2021, according to Labor Department data released Tuesday. The report — delayed by an extended government shutdown — paints a picture of a cooling labor market in the world's largest economy.

Payrolls: October Drop, November Modest Gain

The economy lost 105,000 payroll jobs in October, a decline that included a steep 162,000 fall in federal employment after some workers accepted deferred separation offers during the shutdown. Payrolls rebounded in November with a modest gain of 64,000 jobs, but hiring remained slower than in earlier months. The November gains were concentrated in health care and construction, while federal government payrolls continued to shrink.

Wages, Spending And Long-Term Unemployment

Average hourly earnings increased 0.1% in November to $36.86 and were up 3.5% year-over-year — both figures represent a slowdown from the prior month. A separate Commerce Department report showed retail sales were flat in October at $732.6 billion, with declines at motor vehicle dealers, gas stations and restaurants.

Long-term unemployment is rising: the number of people unemployed for 27 weeks or more climbed about 15.5% over the past year, reflecting a growing share of jobseekers who remain out of work for extended periods.

Policy Implications And Reactions

Economists and policymakers said the data will be closely watched for clues about the Federal Reserve's next moves. The Fed has cut rates three times this year as the labor market softened, but officials have signaled the bar for further cuts remains elevated. A rapidly deteriorating jobs market could push the central bank to ease policy further, though some officials worry higher inflation could persist.

"Government workers who took buyouts are staying in the labor force and looking for work," Kevin Hassett, the president's chief economic adviser, told reporters. "I expect that they'll be very successful with it."

Political reactions were swift. Senator Elizabeth Warren criticized the administration's trade and economic policies, saying tariffs and uncertainty were "hammering the labor market." Economists including Heather Long and Samuel Tombs pointed to shutdown-related disruptions and structural shifts — such as aging-driven health-care hiring and firms adjusting to tariffs and AI — as contributing factors in the softer jobs picture.

Bottom line: The labor market is showing clear signs of cooling — slower hiring, softer wage growth, flat retail sales and rising long-term unemployment — complicating the Fed's policy calculus and the outlook for economic momentum into next year.

Data release was delayed by a government shutdown that prevented timely collection of survey responses; no official jobless rate was reported for October for that reason.