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[Matlab](http://matlab.com) by The MathWorks lets you access, visualize, and analyze historic time-series data to identify patterns or uncover complex relationships. From within a single environment you can:

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MATLAB

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Stata

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[SASEHAVR](http://support.sas.com/documentation/cdl/en/etsug/67525/HTML/default/viewer.htm#etsug_sasehavr_gettingstarted01.htm) is a seamless interface between Haver and SAS data processing that enables SAS users to read economic and financial time series data that reside in a Haver Analytics DLX (Data Link Express) database. [SASEHAVR](http://support.sas.com/documentation/cdl/en/etsug/67525/HTML/default/viewer.htm#etsug_sasehavr_gettingstarted01.htm) requires both SAS/ETS and Base SAS Software.

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[RATS (Regression Analysis of Time Series) Econometric Software](https://estima.com) by Estima is a leading econometrics and time-series analysis software package. It provides ability to do linear and non-linear least squares, forecasting, SUR and ARIMA models and in addition, supports advanced techniques such as GMM, ARCH and GARCH models, state space models, and more.

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RATS

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Understanding the concept of cointegration and testing using the Enger-Granger test

Estimating and forecasting with vector error correction models

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Teaches econometrics and forecasting at the University of Colorado Denver. He has over 15 years of econometric experience in both the private and public sector.

Daniel L. Jerrett, Ph.D.

Abdel M. Zellou, Ph.D.

Bootcamp and Econometric Tools 1 & 2

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Haver partners with Clear Future Consultants to offer a two week immersive online course introducing participants to the power of the Python programming language. This applied hands-on training develops statistical economics skills with a concentration on economics and finance.

Gain proficiency in building modern time-series models in Python through real-world applications. Designed for professionals in both the public and private sector, the course does not require prior experience, assuming only that participants have a basic understanding of regression and statistical concepts.

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Remote Training: Applied Time Series in Python

Weaker economic data surprises pushing down US interest rates

Tom Moeller

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The ADP National Employment Report indicated that nonfarm private sector payrolls increased 103,000 (2.0% Y/Y) during November following a 106,000 October gain, revised from 113,000. A 123,000 November gain had been expected in the Action Economics Forecast Survey. Three-month average growth of 99,000 remained the weakest since March 2021 and below the most recent high of 345,000 per month in July.

Employment at medium-sized firms (50-499,000 employees) rose 68,000 (2.8% y/y) in November after increasing 74,000 in October, well below a 180,000 June high. Large business hiring (500+ employees) rose 33,000 (0.2% y/y) during November following a 14,000 October gain. These gains are improved from declines in both Q3 and Q2. Employment at small firms with less than 50,000 employees rose 6,000 (2.0% y/y) after rising 21,000 in October. These increases are well below the gains earlier in the year.

By industry group, goods-producing employment fell 14,000 (+2.6% y/y) after a 5,000 October decline and a 5,000 September rise. Hiring in the manufacturing sector declined 15,000 (-1.3% y/y), the third consecutive monthly drop. The number of construction jobs fell 4,000 (+4.9% y/y) after a 3,000 October gain. Natural resource & mining sector employment rose 5,000 (21.8% y/y) following a 3,000 October slip.

Service-producing jobs rose 117,000 last month (1.9% y/y) following a 111,000 rise and remained well below July’s 269,000 increase. Holding back the overall gain, professional & business services employment declined 5,000 (-0.3% y/y), the third consecutive monthly drop. The number of leisure & hospitality jobs fell 7,000 (+8.1% y/y) after a 27,000 October increase. To the upside, education & health services employment rose 44,000 (1.8% y/y) last month after improving 40,000 in October. Trade, transportation & utilities payrolls rose 55,000 (1.4% y/y) in November after gaining 29,000 in the prior month. Financial activities employment rose 11,000 (-1.5% y/y) after increasing 17,000 in both October and September. Information sector employment improved 4,000 (-1.3% y/y) following no change in October.

Growth in median annual pay for "job stayers" dipped to 5.6% y/y in November from 5.8% y/y in October, remaining well below a September 2022 high of 7.8% y/y. The earnings slowdown continued to be led by the leisure & hospitality sector, where a 6.5% y/y pay gain in November compared to 16.9% y/y growth in March 2022. Education & health services pay rose a lessened 6.2% y/y, down from a 7.3% y/y high last October. Financial sector earnings rose 6.0% y/y, below a 7.8% y/y high in November of last year, while information sector pay rose a lessened 5.2% y/y and remained below the 8.0% y/y peak in June 2022. Factory sector earnings rose 5.1% y/y versus a high of 7.8% y/y in September 2022. Pay increases for “job changers” decelerated to 8.3% y/y, below the 16.4% y/y peak in June 2022.

By Census region, the number of jobs in the South increased 58,000 last month (-0.7% y/y) after a 63,000 increase. Employment in the Northeast improved 59,000 (6.4% y/y) following a 19,000 October increase. Jobs in the Employment in the West fell 10,000 (+2.0% y/y) in November following a 44,000 rise. Midwest rose 2,000 (2.9% y/y) after declining 15,000 in October.

The ADP National Employment Report and Pay Insights data can be found in Haver's **USECON** database. Historical figures date back to January 2010 for private employment. Pay data date back to October 2020. The expectation figure is available in Haver's **AS1REPNA** database.

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- Job growth is sharply below Q3.
- Factory & construction jobs decline; service gain is modest.
- Pay gains slow.

ADP Employment Increase Is Modest in November

Winnie Tapasanun

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The U.S. trade deficit in goods and services (BOP basis) widened to $64.26 billion in October from $61.15 billion in September ($61.54 billion originally), according to the U.S. Census Bureau. The October deficit was the biggest since July but smaller than the $78.33 billion in October 2022. A $64.3 billion deficit had been expected in the Action Economics Forecast Survey. Exports fell 1.0% m/m (+1.3% y/y) in October, the first monthly fall since June, after a 2.3% increase in September (+2.2% originally). Imports rose 0.2% (-3.2% y/y), the third m/m rise in four months, after a 2.7% September rebound (unrevised).

The deficit in goods trade (BOP basis) rose to $89.80 billion in October, a three-month high, from $86.32 billion in September, but it was smaller the $98.21 billion in October 2022. Goods exports fell 1.8% (-1.2% y/y) in October, the first m/m fall since June, after a 3.1% increase in September. Imports of goods ticked up 0.1% (-3.9% y/y), up for the third month in four, after a 2.7% September rebound. The services trade surplus increased to $25.54 billion in October after declining to $25.17 billion in September; it was larger than the $19.88 billion in October last year. Services exports grew 0.7% (6.8% y/y) in October, the third straight m/m gain, after rising at the same pace in September. Services imports rose 0.4% (-0.4% y/y) following a 2.5% September rise and two consecutive m/m drops.

The real (inflation-adjusted) goods trade deficit (customs value; chained 2017 dollars) widened to a three-month-high $87.04 billion in October from $86.30 billion in September, but it was smaller than the $95.003 billion in October 2022. Real exports of goods eased 0.2% (+1.9% y/y), the first m/m decline since April, following a 2.1% increase in September. Real imports of goods grew 0.2% (-2.3% y/y), the third m/m gain in four months, after a 2.5% rebound in September. A widening trade balance (net exports) has subtracted 0.04%-points from GDP growth in Q3 2023 after adding 0.04%-points in Q2 2023.

The customs value goods trade deficit widened to $89.56 billion in October, the biggest since July, from $86.83 billion in September, but it was smaller than the $97.75 billion in October 2022. The latest figure was in line with an $89.84 billion deficit in the advance report released on November 29. Custom value exports fell 1.4% (-1.3% y/y) in October, the first m/m fall in four months, after a 2.9% gain in September, reflecting m/m drops of 9.0% (+7.3% y/y) in nonfood consumer goods excluding autos, 6.7% (+5.9% y/y) in other goods, 5.8% (+10.2% y/y) in automotive vehicles, parts & engines, and 1.8% (-4.6% y/y) in foods, feeds & beverages. To the upside, exports for industrial supplies & materials rose 2.0% (-9.4% y/y), the fourth straight m/m rise; exports for capital goods excluding autos rose 0.2% (3.3% y/y), up for the fifth successive month.

Customs value imports edged up 0.1% (-3.9% y/y) in October, the third m/m increase in four months, after a 2.7% gain in September, reflecting m/m rises of 2.5% (-1.7% y/y) in capital goods excluding autos and 1.0% (-4.4% y/y) in foods, feeds & beverages. In contrast, goods imports for automotive vehicles, parts & engines (-2.4%; +11.6% y/y), other goods (-1.8%; +3.4% y/y), industrial supplies & materials (-0.5%; -13.8% y/y), and nonfood consumer goods excluding autos (-0.4%; -5.7% y/y) registered their m/m decreases in October. Meanwhile, petroleum imports fell 2.7% (-9.2% y/y) in October, the first m/m fall since June, following a 5.8% increase in September, while nonpetroleum imports rose 0.3% (-3.4% y/y), the third m/m rise in four months, after a 2.5% September rebound.

The 0.7% October gain (6.8% y/y) in services exports was led by rises of 2.5% (10.4% y/y) in insurance services and 2.4% (8.4% y/y) in transport services, while construction services exports fell 9.2% (-43.4% y/y), the second consecutive m/m fall and travel services exports fell 0.7% (+21.9% y/y) following three consecutive m/m gains. The October 0.4% rise (-0.4% y/y) in services imports reflected increases of 1.7% (18.0% y/y) in travel services and 1.0% (-5.9% y/y) in financial services; however, services imports for the use of intellectual property slid 0.5% (-6.9% y/y), the fourth straight m/m slide and transport services imports fell 0.4% (-10.3% y/y), the third m/m fall in four months.

The U.S. goods trade deficit with China narrowed to a seasonally adjusted $23.92 billion in October after widening to $24.12 billion in September. Exports advanced 10.1% (1.6% y/y) in October on top of a 13.5% September jump and imports rose 2.9% (-6.4% y/y) after an 8.5% rise; both posted the third m/m increase in four months. The goods trade deficit with the European Union widened to $19.18 billion in October, the largest since October 2022, after narrowing to $16.76 billion in September, with exports falling 2.1% (+0.7% y/y) and imports rising 3.8% (-5.4% y/y). The trade shortfall with Japan fell to $6.56 billion in October after widening to $6.88 billion in the previous month, reflecting declines of 2.6% (+0.8% y/y) in exports and 3.6% (+3.3% y/y) in imports. As shown in the area chart, the trade deficit with China was the largest among the three trading partners.

The international trade data, including relevant data on oil prices, can be found in Haver's **USECON** database. Detailed figures on international trade are available in the **USINT** database. The expectations figures are from the Action Economics Forecast Survey in **AS1REPNA**.

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- Deficit widens as expected in Oct. for the third time in four months.
- Exports down for the first time since June, but imports up for the third month in four.
- Real goods trade deficit widens to $87.04 billion, the largest since July.
- Goods trade deficits w/ China and Japan narrow, while trade shortfall w/ EU rises to a one-year high.

U.S. Trade Deficit Widens to $64.26 Billion in October, a Three-Month High

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Nonfarm business productivity increased 5.2% (SAAR), revised from 4.7%, during Q3. The 2.4% y/y increase compared to a 2.0% decline during all of 2022. The quarterly gain followed a 3.6% Q2 increase according to the Bureau of Labor Statistics. Expectations had been for a 4.9% rise in the Action Economics Forecast Survey. The latest increase was the largest since Q3’20.

Hours-worked in the nonfarm business sector rose 0.9% (0.8% y/y), revised from 1.1%, after falling 1.5% in Q2.

Hourly compensation strengthened an unrevised 3.9% last quarter (4.0% y/y) after a 6.2% Q2 gain. Adjusted for price inflation, real compensation per hour rose 0.3% (0.4% y/y) after increasing a downwardly revised 3.4% in Q2.

Productivity strength caused unit labor costs to decline 1.2% (+1.6% y/y), revised from 0.8%, after a 2.6% Q2 gain, revised from 3.2%. The Action Economics Forecast Survey called for a 1.0% quarterly fall in unit labor costs.

In the manufacturing sector, output per hour fell 0.8% last quarter (-0.7% y/y), revised from -0.7%, after increasing 3.3% in Q2, revised from 3.1%. Manufacturing output eased a little-revised 0.3% (-0.8% y/y) following a 1.1% rise in Q2. Hours-worked rose 0.5% (-0.1% y/y) after falling 2.1% in Q2.

Compensation per hour in manufacturing strengthened 5.4% (4.4% y/y), revised from 6.2%, following an 8.1% Q2 increase, revised from 9.7%. Real compensation rose a lessened 1.8% (0.9% y/y) after gaining 5.2% in Q2, revised from 6.8%. As a result, unit labor costs in manufacturing surged 6.2% (5.2% y/y), revised from 7.0%, after a 4.7% Q2 rise, revised from 6.3%.

The productivity and labor cost data are available in Haver’s **USECON** database. The Action Economics expectations figures are in the **AS1REPNA** database.

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- Increase in productivity is largest in three years; compensation growth slows.
- Unit labor costs decline following two quarters of increase.
- Decline in factory sector productivity bolsters unit labor costs.

U.S. Productivity Strength Revised Up in Q3

Kathleen Stephansen, CBE

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Mortgage applications rose 2.8% w/w (-11.3% y/y) in the week ending December 1, after a 0.3% w/w (-15.4% y/y) rise in the week ending November 24, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey. The latest reading was the fifth successive weekly gain. Applications for loans to purchase a house eased 0.3% (-17.7% y/y) following the 4.7% (-19.9% y/y) rise in the prior week. In contrast, applications for loan refinancing jumped 13.9% (9.5% y/y) in the week ending December 1, after a decline of 8.9% (+0.7% y/y) in the week ending November 24.

Mortgage interest rates fell further, providing support for mortgage applications. The effective interest rate on a 30-year fixed-rate loan dropped 20bps to 7.35% in the week ending December 1, from 7.55% in the week ending November 24, and down from 7.81% in the November 3 week. The rate on 15-year fixed-rate mortgages fell 2bps to 6.99% in the latest week from 7.01% in the prior week. The rate on a 30-year Jumbo loan dropped 25bps to 7.47% in the week ending December 1, down from 7.72% in the prior week, while the rate on a 5-year ARM loan declined 3bps to 6.84% in the latest week from 6.87% in the week ending November 24.

The share of applications for refinancing an existing loan rose to 34.7% in the week ending December 1, up from 30.6% in the week ending November 24. The adjustable-rate mortgage (ARM) share of activity fell to 7.4% in the latest week from 8.1% in the prior week, the fifth consecutive w/w fall.

The average size of a mortgage loan declined 4.5% w/w (-1.5% y/y) to $345,900 in the week ending December 1, after a 3.2% (-1.4% y/y) rise to $362,300 in the week ending November 24. The average size of a loan to purchase a home decreased 3.6% (+2.4% y/y) to $396,500 in the latest week, after a 1.9% (2.8% y/y) rise to $411,100 the week ending November 24. The average size of a loan to refinance a mortgage eased 0.3% (-3.8% y/y) to $251,000 in the week ending December 1, following the 4.4% (-8.5% y/y) jump to $251,800 in the prior week.

The Mortgage Bankers Association Survey covers 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver’s **SURVEYS** database.

- Applications for loans refinancing provided support for overall mortgage applications in the December 1 week.
- Effective interest rates fell in the latest week, with the 30-year fixed rate dropping 20bps.
- The average size of mortgage loans declined in the latest week.

U.S. Mortgage Applications Gained Support from Refinancing Applications

Robert Brusca

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German manufacturing orders and sales both fell in October. Total orders fell by 3.7% month-to-month after climbing by 0.7% in September. Foreign orders fell by 7.6% in October after rising 5% in September. Domestic orders rose 2.4% month-to-month after falling 5.7% in September. The sector results between foreign and domestic trends, therefore, are not completely in-sync, but they're not completely different either since over two months, both series show net declines.

Recalibrating to look at order-trends sequentially, over 12 months, six months, and three months, declines persist but are not the case for every single one of the sub-periods.
•	Total orders fall 7.2% over 12 months, then go flat over six months, and then fall again over three months at a 4.9% annual rate.
•	Foreign orders fall 7.1% over 12 months, but then rebound to rise at a 5.8% pace over three months, and then continue to drop at a 5.4% annual rate pace over three months.
•	Domestic orders fall 7.3% over 12 months, fall at a faster 8% pace over six months, and then trim their rate of descent to -4.8% annualized over three months.
•	Domestic orders clearly have the worse profile in comparison with foreign orders; however, neither domestic nor foreign orders show clear ongoing decelerating patterns although they both show patterns revealing persistent declines.

Real sales trends show all manufacturing sales declined by 0.5% in October, by 1.4% in September, and by 0.5% in August. German sales have a clear losing streak. The sequential trends for manufacturing sales show the following:
•	A 2.2% drop over 12 months, a faster 2.6% pace of decline over six months, and a much faster 9.2% pace of decline over three months. Unlike orders, sales are showing a truly clear decelerating pace. Looking at sectors...
•	Consumer goods overall show declines in sales over three months, six months, and 12 months and there is a tendency for the pace of decline to worsen over this profile although it's only a tendency not an ironclad rule.
•	Consumer durables are a subset of total consumer spending. Sales fall 9.3% over 12 months, but then the six-month pace goes to -21% annualized, and the three-month pace is -19.6% annualized; it’s not precisely a deceleration but close enough for me with enough weakness over six and three months and worse weakness that over 12 months to look a lot like deceleration in progress.
•	Sales of consumer nondurable goods fall by 2.7% over 12 months, make a small gain of 0.6% at an annual rate over six months and then continue declining at an accelerated 5.2% annual rate.
•	Capital goods sales rise 1.4% over 12 months, worsen to a -0.4% annualized pace over six months, and then worsen further to a -12.2% annual rate over 3 months, a clear deceleration.
•	Intermediate goods essentially show deterioration as well: sales fall at a 5.8% annual rate over 12 months, show a very slight improvement at -5.3% annualized over six months, and then accelerate the decline to -6% over three months.
Clearly, sales show a preponderance of weakness, a preponderance of declines, and a clear tendency for the rate of decline to worsen over shorter periods.

**Emerging sales and order trends in the fourth quarter**
The most up-to-date data are for October, which means we have data through the first month of the fourth-quarter; we can annualize this behavior by looking at the annual rate gain of orders or sales in October compared to the third quarter average. Doing this, we find that orders are falling at a 15.1% annual rate, led by a 21.9% annual rate fall in foreign orders and joined by a 4.8% annual rate decline in domestic orders. Real sector sales show a decline in manufacturing sales at a 9.2% annual rate; consumer durable goods sales fall at a 29.9% annual rate; consumer nondurables sales fall at a 4.1% annual rate; capital goods sales fall at a 7.8% annual rate; intermediate goods sales fall at a 12% annual rate. Both orders and sales fall on a quarter-to-date basis across all these categories and fall at relatively high rates of decline.

The bottom of the table presents readings from the European Commission on industrial confidence for Germany, France, Italy, and Spain, the four largest economies in the European Monetary Union (EMU).
•	The month-by-month industrial confidence figures for Germany show a slight tendency toward improvement from August to September to October. France also shows a small improvement in train, while Italy and Spain show a tendency toward slippage across this three-month horizon.
•	Turning to the broader picture of trends over 12 months, to six months, to three months, we find the German trends show clear slippage worsening from a -5.1 survey value over 12 months to a -14.8 survey value over three months; France also worsens on this horizon; Italy steadily worsens on this horizon; so does Spain.
•	The upshot is that over the last few months, there have been mixed trends, but the broader trend for the year favors the conclusion that there is weakening all around in the European Monetary Union at least based on the four largest economies. The queue or ranked standings for the EU Commission readings in October compare these up-to-date readings to their historic values, revealing consistent readings across these four countries. Germany has a 23-percentile standing, like Italy's 24-percentile standing, while both France and Spain have 34-percentile standings.
•	The standing data read 100% when the EU Commission indexes are at their highest values and they're at 0% when it's at their lowest values. The median for the EU survey occurs at a rank standing of 50%; all these readings are below the 50th percentile, placing them below their medians significantly below their medians over this timeline.

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**Summing up trends-** The performance of the industrial sector in Germany shows weak and declining orders, significantly weakening and deteriorating trends for industrial sales plus weakness across the largest economies of the European Monetary Union. In the quarter-to-date, orders are falling sharply as are sales both adjusted for inflation. The inflation rate in the EMU has been declining as it has been doing globally in the United States, the United Kingdom, and elsewhere. However, central banks continue to overshoot their inflation targets, but when this happens amid worsening economic performance, the odds that the central bank will fight inflation less aggressively begin to improve as central banks begin to start handicapping the prospect of an economic downturn which always has the effect of depressing prices and lowering inflation- at least to some extent.

**The policy cycle-** That explains where we are in the policy cycle right now. The ECB has been raising rates. Inflation has stopped accelerating and is decelerating. The economy is weak and shows a good deal of weakness and even, what may be, growing weakness across the monetary union. That's an interpretation that the European Central Bank officials will have to make. They will have to decide whether they think inflation is falling fast enough and the economy is weak enough for them to begin to ease back on the tightening process and let the progress of economic forces that are in train take the inflation rate on a more natural path lower. If they don't think that's the right policy, then they may feel that they still need to raise rates a little bit more to give inflation a bigger downward push and likely to create a potentially sharper or longer economic downturn. These sorts of policy choices are going to be made in the U.K. and the U.S. as well, but these other countries are facing different degrees of progression in terms of the weakness of strength and growth and the trend for inflation and particularly the trend for inflation relative to target.

Germany

Slippage and Decline Hit German Real Manufacturing Sales and Orders

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The U.S. labor market weakened during October as employers responded to softer economic conditions relative to strength during Q3. Job openings declined 6.6% last month (-16.6% y/y) to 8.733 million following a 1.5% September decline to 9.350 million, revised from 9.553 million. It was the lowest level of openings since March 2021 according to the Job Openings and Labor Turnover Survey. The job openings rate fell to 5.3% from 5.6% in September, revised from 5.7%. It was the lowest rate since February 2021 and down from a 7.4% high in March 2022. This rate is calculated as the ratio of job openings to total nonfarm employment plus openings.

Private sector openings fell 7.6% (-18.6% y/y) to 7.746 million in October after easing 0.6% in September. The private job openings rate fell to 5.5% last month from 5.9% in both September and August. It was the lowest rate since February 2021. The decline in private openings last month was led by a 12.5% decline (-22.5% y/y) in education & health services. Leisure and hospitality followed with a 10.0% decline (-24.1% y/y). Trade, transportation & utilities opening were off 7.1% (-22.2% y/y) but professional & business services openings improved 5.6% (-7.4% y/y). Job openings in the government sector increased 1.8% (3.7% y/y).

Total hiring eased 0.3% (-4.5% y/y) during October following a 0.9% September increase, revised from 0.4%. The hiring rate slipped to 3.7% from 3.8%. It was down from a 4.6% high in November 2021. Private sector hiring fell 0.4% (-4.6% y/y) following a 1.1% September gain. This decline was paced by a 23.0% drop (-42.4% y/y) in information services and a 5.5% drop (-7.6% y/y) in trade, transportation & utilities. Factory sector employment declined 4.6% (-15.8% y/y). These declines were offset by a 21.4% rise (6.8% y/y) in construction hiring and an 8.6% increase (1.8% y/y) in professional & business services. Education & health services jobs rose 4.4% (9.5% y/y) while government sector hiring increased 1.1% (-3.9% y/y). The private sector hiring rate was also unchanged at 4.1%.

Total separations rose 0.9% (-3.4% y/y) to 5.646 million in October following a 1.6% decline in September. The rise reflected a 2.0% increase (7.7% y/y) in layoffs & discharges which followed a 4.3% decline. The layoff & discharge rate held steady at 1.0%, down from the 1.2% March high. Quits declined 0.5% last month (-10.4% y/y), the same as in September. Leisure & hospitality quits fell 7.7% last month (-13.8% y/y) but construction quits rose 25.4% (13.1% y/y).

The Job Openings and Labor Turnover Survey (JOLTS) data are available in Haver’s **USECON** database.

- Job openings post largest decline in five months; revisions indicate weakness.
- Hiring declines after two months of increase.
- Total separations rise as layoffs increase.

U.S. JOLTS: Job Openings Decline Sharply in October

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The U.S. ISM Services PMI rose to 52.7 in November after declining to 51.8 in October, according to today’s report by the Institute for Supply Management, indicating expansion for the 11th straight month at a faster pace. The November reading, while up from a low of 49.2 in December 2022, was below 55.5 in November 2022 and a peak of 67.6 in November 2021. The 12-month average was 52.7, reflecting strong growth in the U.S. services sector. The Action Economics Forecast Survey had expected 52.2 for November.

Haver Analytics constructs a composite index combining the services index and the manufacturing reading. This index rebounded to 51.9 in November from 51.2 in October, showing expansion for the sixth successive month at a slightly faster rate. These readings remained down from 54.7 in November 2022 and a record 66.8 in November 2021. These series date back to July 1997.

In the latest services survey, the business activity index rebounded to 55.1 in November from 54.1 in October, indicating business activity expanded for the 42nd consecutive month at a faster pace. The index was below 61.6 in November 2022 and a record 70.4 in November 2021. An increased 24.6% of respondents (NSA) reported higher activity in November while a lessened 12.6% reported an activity decline. The employment index increased to 50.7 in November after falling to 50.2 in October, showing employment activity in the services sector expanded for the sixth straight month at a slightly faster rate. The latest reading was marginally higher than 50.6 in November last year. A 14.3% of respondents (NSA) indicated higher employment in November while a lessened 13.8% reported a decline.

Meanwhile, the new orders index was unchanged at 55.5 in November, indicating expansion in new orders for the 11th successive month. The index, while up from a low of 45.2 in December 2022, was below 55.8 in November 2022 and a record 69.2 in October 2021. An increased 25.4% of respondents (NSA) reported higher orders in November while a lessened 13.9% reported a decline.

The supplier deliveries index (NSA) increased to 49.6 in November after dropping to 47.5 in October, remaining below 50 for the second consecutive month. The index, while up from a low of 45.8 in March, was below 53.8 in November 2022 and a high of 75.7 in November 2021. An increased 10.5% of respondents (NSA) reported faster delivery speeds in November while 9.6% reported slower speeds.

On the inflation front, the prices index slipped to 58.3 in November from 58.6 in October, indicating prices paid by services organizations for materials and services had risen (i.e., above 50) since June 2017. The latest reading was up from a low of 54.1 in June but meaningfully below 70.1 in November 2022 and a record 84.5 in December 2021. A 22.3% of respondents (NSA) reported price rises in November while 9.5% reported price decreases.

Additionally, the new export orders index rose to 53.6 in November after plunging to a contraction-level 48.8 in October, indicating new export orders expanded for the seventh time in eight months. The inventory change index recovered to 55.4 in November from a contraction-level 49.5 in October, indicating inventories expanded for the sixth time in seven months. The inventory sentiment index jumped to 62.2 in November after declining to 54.4 in October, showing expansion for the seventh straight month at the highest pace since April 2020. In contrast, the imports index fell to 53.7 in November after jumping to 60.0 in October, registering the eighth successive expansion but at a slower pace. The backlog of orders index declined to 49.1 in November after rising to 50.9 in October, showing contraction for the third time in four months. These series are not seasonally adjusted and not included in the ISM Services PMI total.

The ISM Services PMI is a composite index consisting four equally weighted diffusion indexes (25% each): Business Activity, New Orders, Employment, and Supplier Deliveries. A reading above 50 indicates expansion in the services sector; below 50 suggests contraction. Supplier Deliveries is the only ISM index that is inversed; a reading above 50 indicates slower deliveries. The ISM figures are available in Haver’s **USECON** database, with additional detail in the **SURVEYS** database. The expectations figure from Action Economics is in the **AS1REPNA** database.

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- 52.7 in Nov. vs. 51.8 in Oct., showing continued expansions in services since Jan. ’23.
- Indexes for Business Activity (55.1), Employment (50.7), and Supplier Deliveries (49.6) rebound in Nov., while New Orders Index holds steady (55.5).
- Prices Index eases to 58.3, albeit remaining above 50 since June ’17.

U.S. ISM Services PMI Rebounds in November

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Retail gasoline prices held steady last week at an average $3.36 per gallon (-4.3% y/y) for all grades. It remained the lowest price since the first week of January. The price reached a high of $4.00 in the third week of September. Prices have ranged between $3.20 and $5.11 for the last year. The retail price for on-highway diesel fuel fell to $4.09 per gallon (-17.6% y/y) last week from $4.15 in the prior week. The latest price was increased from a low of $3.77 in early-July.

The price of West Texas Intermediate crude oil fell to $75.69 per barrel (-4.6% y/y) in the week ended December 1 after edging up to $77.10 in the prior week. These remained below the recent high of $91.45 in the last week of September but were above the late-June low of $69.37. Prices remain well below the high of $120.46 in the week of June 10, 2022. Yesterday, the price was $73.04	per barrel. Brent crude prices fell to $81.04 per barrel (-4.7% y/y) last week compared to $81.62 in the prior week. Prices remained below the late-September high of $95.61. The high for Brent was $127.40 in the week of June 10, 2022. Yesterday, the price was $78.16 per barrel.

Natural gas prices improved to an average $2.72/mmbtu (-55.1% y/y) in the week of December 1, after falling to $2.64 in the previous week. Prices reached a high of $9.56/mmbtu in the last week of August 2022 and a low of $1.93 in the first week of June. Yesterday, the price was $2.55/mmbtu.

In the four weeks ended November 24, gasoline demand rose 2.1% from a year earlier after rising 2.5% y/y in the prior four-week period. Demand for all petroleum products fell 1.4% y/y after declining 1.2% y/y in the previous four weeks. Crude oil input to refineries fell 4.8% y/y in the latest four weeks, after declining by the same amount in the prior four week period.

Gasoline inventories rose 2.1% y/y in the week of November 24 after rising 2.6% y/y in the previous week. Residual fuel oil inventories fell 12.2% y/y after declining 6.9% y/y in the previous week. Crude oil inventories, including the Strategic Petroleum Reserve, fell 0.9% y/y following a 2.8% y/y decline in the previous week.

Measured in days’ supply, gasoline inventories in the week of November 24 stood at 24.8 days versus 24.3 days in the prior week. The recent high was 29.7 days in the third week of January and the recent low was 23.4 days in the last week of June. The supply of crude oil was 28.9 days. The recent high was 31.9 days at the beginning of March.

These data are reported by the Energy Information Administration of the U.S. Department of Energy. The price and supply/demand data can be found in Haver’s **WEEKLY** & **USENERGY** databases.

- Gasoline prices held steady but diesel fuel prices continued to fall.
- Crude oil prices resumed their decline.
- Natural gas prices rose.


U.S. Energy Prices Are Mixed

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Moderate growth describes the November job market report. Nonfarm payrolls increased 199,000 (1.8% y/y) after rising an unrevised 150,000 in October and 262,000 in September, revised from 297,000. So far this year, payrolls have risen an average 232,000 per month after an average 399,000 in 2022. The latest increase compared to expectations for a 190,000 gain in the Action Economics Forecast Survey.

Average hourly earnings rose 0.4% in November following an unrevised 0.2% October gain and a 0.3% September increase, revised from 0.2%. The 4.0% y/y earnings increase remains well below a high of 5.9% y/y in March 2022. A 0.3% November gain had been expected.

The unemployment rate, measured in the household survey, declined to 3.7% in November from 3.9% in October. It was the lowest rate since July but was higher than its 3.4% April low. Expectations had been for a 3.9% rate. Household employment rose 747,000 after declining 348,000 in October. The labor force increased 532,000 following a 201,000 decline. The overall unemployment rate, including workers who were marginally attached & working part-time for economic reasons, fell to 7.0% last month and reversed its October increase to 7.2%. The rate has been trending higher since its 6.5% December 2022 low.

In the **establishment survey**, private-sector employment increased 150,000 (1.6% y/y) after increasing 85,000 in October. Factory sector jobs rose 28,000 (2.2% y/y) after a 35,000 October decline. Construction sector employment rose 2,000 (2.6% y/y) after a 25,000 October increase.

Private service-producing employment improved 121,000 (1.7% y/y) after rising 95,000 in October. Industry performance remained mixed. Trade, transportation & utilities employment fell 35,000 (+0.3% y/y) but leisure & hospitality payrolls rose 40,000 (3.2% y/y). Education & health care jobs gained 99,000 (4.2% y/y) while professional & business jobs fell 9,000 (+0.9% /y), including a 13,600 decline (-5.1% y/y) in temporary help employment. Financial sector employment improved 4,000 (0.6% y/y) and information sector payrolls rose 10,000 (-3.1% y/y) following six straight months of decline.

Government sector payrolls rose 49,000 (2.9% y/y) after a 65,000 October gain. Local government payrolls rose 32,000 (2.3% y/y) and state government jobs increased 17,000 (4.5% y/y). The number of federal government jobs held steady (+2.9% y/y).

The 0.4% gain in private-sector average hourly earnings reflected a 0.5% rise (5.3% y/y) in goods-producing earnings. Construction sector earnings rose 0.5% (4.9% y/y) and factory sector earnings strengthened 0.6% (5.3% y/y). In the private services sector, earnings rose 0.3%. The 3.6% y/y increase remained well below its high of 6.1% in March 2022. Leisure & hospitality earnings increased 0.6% and 4.6% y/y, still well below the 14.0% y/y peak in December 2021. Information sector pay rose 0.5% (2.3% y/y). Financial activities earnings surged 0.5% (5.5% y/y). Trade, transportation & utilities sector pay rose 0.3% (4.2% y/y) last month. Professional & business sector earnings improved 0.4% (4.1% y/y) while private education and health services pay edged up 0.1% (2.5% y/y) after two consecutive 0.2% monthly increases.

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The length of the average workweek improved to 34.4 hours in November but remained below a peak of 35.0 hours in January 2021. The workweek in the goods-producing sector held steady at 39.9 hours. The construction sector workweek improved to 39.3 hours, while the factory sector workweek held at 40.0 hours. The average workweek in the private service sector was steady at 33.3 hours for the ninth straight month but remained below the 34.0 hour high early in 2021. Financial sector hours have been unchanged at 37.4 hours but information services hours slipped to 36.0 hours. Professional & business service hours rose to 36.5 hours while leisure & hospitality hours were unchanged at 25.5 hours in November.

The private sector’s aggregate weekly hours index, a key indicator of production and income, rose 1.3% (+0.9% y/y) in November but has risen only 0.3% on average so far in the fourth quarter.

In the **household survey**, the lower 3.7% unemployment rate in November was accompanied by a higher 62.8% labor force participation rate. It has been trending higher from a low of 61.3% in January 2021. The participation rate for teenagers fell to 37.5% from a 14-year high of 37.9% in October. For workers aged 20-24, the rate eased to 71.6% and compared to a high of 72.0% in February & March. For workers aged 25-54, the rate held steady at 83.3% in November, but was increased from 81.9% two years earlier. For individuals 55 and over, the rate improved to 38.8% in November but remained well below its 40.5% peak in July 2019.

The employment/population ratio for all workers rose to 60.5% from a low of 51.3% in April 2020. It remained below its reading of 61.1% in February 2020 just prior to the pandemic.

The average duration of unemployment fell sharply to 19.4 weeks in November	from 21.6 weeks in the prior month. The median duration of unemployment rose, however, to 9.2 weeks and reversed October’s decline. It remained below the 19.9-week high in June 2021.

The employment and earnings data are collected from surveys taken each month during the week containing the 12th day of the month. The labor market data are contained in Haver's **USECON** database. Detailed figures are in the **EMPL** and **LABOR** databases. The expectations figures are in the **AS1REPNA** database.

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- Moderate October jobs gain is unrevised; September strength lessened.
- Earnings growth edges up, exceeding expectations.
- Lower jobless rate accompanies strong employment & labor force gains.

U.S. Payroll & Earnings Growth Improve in November; Unemployment Rate Declines

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