U.S. Job Growth Accelerates Much More Than Expected In October

A closely watched report released by the Labor Department on Friday showed employment in the U.S. jumped by much more than anticipated in the month of October.

The Labor Department said non-farm payroll employment surged up by 250,000 jobs in October after rising by a downwardly revised 118,000 jobs in September.

Economists had expected an increase of about 190,000 jobs compared to the addition of 134,000 jobs originally reported for the previous month.

Paul Ashworth, Chief U.S. Economist at Capital Economics, said the significant acceleration in the pace of job growth confirms Hurricane Florence temporarily depressed employment in September.

“The [Bureau of Labor Statistics] suggests that Hurricane Michael, which struck Florida during the October survey period, had no discernible effect,” Ashworth said.

He added, “But it’s possible that we could be in for another 200,000 plus number in November, as the remainder of those disruptions is reversed.”

The bigger than expected jump in employment in October partly reflected notable job growth in the healthcare, manufacturing, construction, and transportation and warehousing sectors.

Meanwhile, the report said the unemployment rate in October was unchanged from the previous month at 3.7 percent, its lowest level since hitting 3.5 percent in December of 1969.

The unemployment rate came in unchanged as the household survey measure of employment showed a substantial increase of 600,000 compared to the 711,000-person spike in the size of the labor force.

Average hourly employee earnings rose by $0.05 to $27.30 in October, reflecting a 3.1 percent increase compared to the same month a year ago.

The annual rate of hourly earnings growth accelerated from 2.8 percent in September, reaching the fastest pace since April of 2009.

“The U.S. jobs market remains incredibly strong and with wages starting to accelerate, domestic price pressures will increase,” said ING Chief International Economist James Knightley.

He added, “This will keep the Federal Reserve on its path of ‘gradual’ interest rate hikes with next week’s FOMC meeting set to signal a December move.”

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