October Jobs Blow Past Forecasts, but Inflation Still Bites
October Jobs Blow Past Forecasts, but Inflation Still Bites
U.S. employers added 165,000 jobs in October, a result that sharply outstripped forecasts and pushed the unemployment rate down to 4.1%. The gain was more than double the 65,000 jobs economists had expected, according to one account of the report.
The official figures offered an even stronger comparison: payrolls beat the Dow Jones estimate of 59,000, while the jobless rate came in below the 4.2% forecast. August and September hiring was revised higher as well, strengthening the case that October was not a one-month statistical fluke.
The composition of the gains mattered. Professional and business services added 70,000 jobs, healthcare gained 42,000, transportation and warehousing rose by 25,000, and manufacturing added 19,000. Seema Shah, chief global strategist at Principal Asset Management, called the report “a strong rebuttal to fears that the economy is heading into a meaningful slowdown,” arguing that broad-based hiring showed an economy still able to absorb workers.
Heather Long, chief economist at Navy Federal Credit Union, likewise said the labor market was on “much better footing than a year ago,” contrasting this year’s wider range of hiring with the earlier concentration of gains in healthcare.
But the upbeat headline did not settle the household-economy argument. Inflation was still eroding the spending power of millions of Americans even as employment expanded. Other warning signs sat beneath the lower unemployment rate: the broader underemployment measure rose to 7.9%, and long-term unemployment climbed, with the average spell reaching 27.1 weeks—the highest since September 2021.
That tension now confronts policymakers. With inflation still above the Federal Reserve’s 2% target, a report that signals labor-market strength could make the case for another rate increase harder to ignore.
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