The labor market report in November offered mixed signals for the District of Columbia labor market. In the establishment survey, payroll employment decreased by 5,000 jobs due to losses in most industry sectors. The household survey, however, indicated continued improvement as the unemployment rate declined for an eighth consecutive month and for the 14th time in the past 15 months. At 8.4 percent, the unemployment rate was 2.1 percentage points lower than its recent peak of 10.5 percent in August 2011.

Looking at the payroll numbers more closely, the November decline in payroll employment resulted from losses in most industry sectors. Educational services and construction experienced the largest declines with losses of 1,600 and 1,000 jobs, respectively. There were notable declines in other services, accommodation and food services, and government employment as well. There were more modest declines in the retail trade and information sectors and employment was flat in professional and business services and health care services. Overall, losses in the private sector totaled 4,500 for the month, the largest one-month decline since April 2009. With the large decline in private employment in November, cumulative job growth for the year turned negative, by 500 jobs. As a consequence, the year-over-year percent change in private sector employment dropped to −0.1 percent in November from 1.4 percent in October, well below the national rate of 1.8 percent. This was in stark contrast to year-over-year payroll growth of 3.2 percent in January. Likewise, total payroll employment growth for 2012 also turned negative, with 3,200 jobs lost from January through November. For the year, there were solid increases in educational and health services along with a moderate gains in other services and a modest uptick in construction. These gains were offset, however, by sizeable losses in government, professional and business services, and leisure and hospitality and more moderate declines in financial services, trade and transportation, and information.

In contrast, the results of the household survey indicated continued improvement in the labor market in November. The unemployment rate fell one-tenth to 8.4 percent. The number of unemployed declined for the 15th consecutive month. The number of employed in the survey jumped by 3,800 and averaged 3,500 over the past three months — a historical record. As a result, the labor force participation rate rose by 1.6 percentage points over the past three months to 69.1 percent.

Overall, the surveys painted a mixed picture of the labor market for November. The unemployment rate continued to decline while private payroll employment dropped sharply and on net was down for all of 2012. Notably, the professional and business services sector, normally a strong sector in the District labor market, was flat in November and down sharply for the year. It appears that concerns about anticipated cutbacks in federal spending have impacted hiring decisions. So, despite improvement in the unemployment rate over the past 15 months, labor market conditions within the District remained weak and the outlook for the near term still uncertain.