U.S. Economy: November 2025 Economic Report Shows Slowing Growth

U.S. Economic Health Report — November 2025

Executive Summary

November 2025 economic data show that the U.S. economy remains in a late‑cycle phase with mixed signals. The Bureau of Labor Statistics released delayed data for October and November together; the national unemployment rate for November was 4.6 percent, up slightly from September’s 4.4 percent. Private‑sector employment declined: the ADP National Employment Report estimated that employers shed about 32 000 jobs in November. Manufacturing continued to contract, with the ISM Manufacturing PMI dropping to 48.2 percent in November from 48.7 in October, marking the ninth straight month of contraction. At the same time, the Treasury yield curve remained positive, with the ten‑year note averaging about 0.54 percentage points above the two‑year note across November. Overall, the economy is still growing but momentum continues to slow as hiring softens and factory output declines.

Labor Market: BLS vs ADP

The Employment Situation for October and November shows that the national unemployment rate rose to 4.6 percent in November. Payroll employment increased only modestly in November (+64 000) according to the establishment survey, reflecting gains in health care and construction but declines in federal government employment. In contrast, the ADP National Employment Report estimated that private employers shed roughly 32 000 jobs during November, with losses concentrated in manufacturing, professional and business services, information, and construction. Gains were limited to education and health services and leisure and hospitality. The divergence between BLS and ADP data suggests that hiring is softening, with private employers becoming more cautious even as some sectors continue to add workers. With unemployment edging higher and ADP showing job losses, the labour market appears to be cooling but not collapsing.

Yield Curve Analysis

U.S. Treasury yields in November 2025 maintained a normal yet flattened curve. On average during the month, the difference between ten‑year and two‑year Treasury yields was about 0.54 percentage points, indicating that investors still require a modest premium for longer maturities. A positive spread implies expectations of continued economic growth and inflation, albeit at subdued rates. However, the curve remains much flatter than in a typical expansion, and any renewed narrowing or inversion would signal increased recession risk. November’s persistent but small positive spread therefore reflects cautious optimism balanced against signs of slowing momentum.

Manufacturing and Business Activity

The ISM Manufacturing PMI slipped to 48.2 percent in November 2025, down from 48.7 in October, remaining below the 50‑percent threshold that separates expansion from contraction. November marked the ninth consecutive month of manufacturing contraction. Sub‑indices showed that new orders declined further, employment fell to about 44 percent, and price pressures intensified. Production rebounded slightly as firms worked through backlogs, but overall factory activity remained weak. Only a small subset of industries reported growth, while most continued to face sluggish domestic and export demand. The November PMI thus underscores the ongoing challenges in the goods‑producing sector.

Integrated Economic Outlook

Taken together, November’s indicators portray an economy still expanding but increasingly late‑cycle. The unemployment rate has risen to 4.6 percent, and ADP’s estimate of a 32 000 job loss points to softening labour demand. The manufacturing sector remains in contraction, with the PMI at 48.2 percent signalling continued weakness in factory activity. The Treasury yield curve is positive but flat, with a ten‑year minus two‑year spread around 0.54 percentage points, suggesting moderate growth expectations. These mixed signals—sluggish job growth, contracting manufacturing, and a flattened yield curve—imply that the U.S. economy is losing momentum even as overall output continues to grow.

What to Watch Next Month

• Monitor the December Employment Situation (released in early January) for signs that the unemployment rate is stabilizing or rising further and whether payroll growth remains subdued.

• Compare ADP’s December private‑sector employment estimate with the BLS figures to gauge whether private hiring continues to soften.

• Watch the manufacturing PMI for any move toward or away from the 50‑point mark, indicating stabilization or renewed decline in factory activity.

• Track changes in the ten‑year minus two‑year Treasury yield spread; a widening spread would suggest improving growth expectations, while a narrowing or inversion would raise concerns about a downturn.

• Observe consumer spending over the holiday season and early indicators for 2026, as household demand will be critical in sustaining economic growth.