The Federal Reserve reported broad-based employment gains across U.S. industries and regions Wednesday, two days before the Labor Department issues its highly anticipated monthly jobs data.
“Employment gains were widespread,” the Fed said in its Beige Book business survey, which is based on reports gathered on or before Nov. 24. “A number of districts also noted that contacts remained optimistic about the outlook for future economic activity.”
The report offers Fed policymakers, who meet Dec. 16-17, anecdotal evidence about improvements in the job market as they consider when to raise interest rates for the first time since 2006. Other data Wednesday showed private employers added 208,000 jobs in November, while services from retailing to construction expanded at the second-fastest pace in more than nine years.
“This is part of the slow march toward an eventual rate hike,” said Brian Jacobsen, who helps oversee $235 billion as chief portfolio strategist at Wells Fargo Advantage Funds in Menomonee Falls, Wis. The Fed report suggests “the timing of liftoff should be unchanged, hanging around the June meeting.”
Employment gains were spread across all 12 Fed districts, from Boston and New York to Cleveland and San Francisco.
In the New York district, financial firms reported hiring more workers. A manufacturer of health and fitness equipment in the Boston region is adding “technically skilled workers but only with great difficulty,” and there were plans to hire workers by aviation, metals, furniture, industrial equipment and automobile parts manufacturers in the St. Louis district.
Even as the job market showed momentum, “overall price and wage inflation remained subdued,” according to the Beige Book. Some districts saw a “slight to moderate” rise in labor costs, which many Fed officials view as a key gauge of so-called labor-market slack.
Also Wednesday, the Institute for Supply Management said its non-manufacturing index rose to 59.3, the second-highest level since August 2005, from 57.1 in October. The figure exceeded the highest projection in a Bloomberg survey of 78 economists.
The Labor Department’s jobs report Dec. 5 is likely to show that all employers, including government, added 230,000 jobs last month, according to the median of 94 estimates compiled by Bloomberg. Economists project the unemployment rate held at a six-year low of 5.8 percent.
Fed banks reported an improvement in business spending, and most districts said manufacturing was stronger.
The Fed said the world’s largest economy is continuing its five-year expansion amid tumbling gasoline prices that are supporting further advances in consumer spending during the holiday shopping season. That’s likely to continue after OPEC’s refusal to cut output pushed crude oil prices to five-year lows.
A filling station in Oklahoma City selling gasoline at $1.99 per gallon became the first reported in the U.S. to sell fuel for less than $2 since July 2010, price-tracking firm GasBuddy said Wednesday in an e-mailed statement.