The U.S. labor market posted a sharp reversal with a loss of 32,000 jobs in November, contradicting the White House's assertion of 'explosive growth' driven by a robust GDP expansion. The divergence is fueling market skepticism and raising questions about the economy's true trajectory ahead of the 2026 election cycle.
- U.S. employment fell by 32,000 in November, reversing prior gains.
- White House cites 4.2% annualized GDP growth in Q3 2025 as evidence of 'explosive growth'.
- Unemployment rate rose to 4.3%, the highest since early 2024.
- 10-year U.S. Treasury yield reached 4.85%, reflecting rising inflation concerns.
- SPX declined 0.6% on labor data, while DXY and USD/JPY saw modest gains.
- Labor weakness in leisure, hospitality, and manufacturing sectors points to softening demand.
A surprising contraction in the U.S. labor market emerged as the November jobs report revealed a loss of 32,000 positions, marking the first decline in employment since early 2023. This figure starkly contrasts with the White House’s recent public statements touting a surge in GDP, which analysts estimate rose at an annualized rate of 4.2% in the third quarter of 2025—well above the 2.5% long-term trend. The disconnect between labor data and growth metrics has intensified scrutiny on the administration’s economic messaging. The decline in employment was broad-based, with the leisure and hospitality sector shedding 18,000 jobs and manufacturing down 9,000, suggesting weakening demand in consumer-facing industries. Meanwhile, the unemployment rate ticked up to 4.3%, the highest level since early 2024. Despite this, the average hourly earnings rose 0.4% month-over-month, indicating persistent wage pressure that may complicate Federal Reserve policy decisions. Financial markets reacted with caution. The S&P 500 (SPX) dipped 0.6% by midday, pressured by concerns over slowing labor demand. The 10-year U.S. Treasury yield climbed to 4.85%, reflecting investor anxiety over inflation persistence. The U.S. dollar (DXY) strengthened slightly, rising 0.3%, while the USD/JPY pair edged to 152.10, signaling safe-haven demand amid growing macro uncertainty.