U.S. Job Growth Falls Short Of Estimates In OctoberNovember 6, 2023
After reporting much stronger than expected job growth in the previous month, the Labor Department released a report on Friday showing U.S. employment rose by less than expected in the month of October.
The closely watched report said employment climbed by 150,000 jobs in October after jumping by a downwardly revised 297,000 jobs in September.
Economists had expected employment to increase by 180,000 jobs compared to the surge of 336,000 jobs originally reported for the previous month.
The weaker than expected job growth came as increases in employment in the healthcare, government, and social assistance sectors was partly offset by the loss of 35,000 manufacturing jobs due to strike activity.
The Labor Department also said the unemployment rate crept up to 3.9 percent in October from 3.8 percent in September. The unemployment rate was expected to remain unchanged.
The unexpected uptick in the unemployment rate came as the household survey measure of employment slumped by 348,000 persons, outpacing a 201,000 person decrease in the size of the labor force.
With the modest increase, the unemployment rate reached its highest level since hitting 4.0 percent in January 2022.
“The real takeaway from this labor report is that while the market is still fairly healthy, the slowdown is real – and may be accelerating,” said Brad McMillan, Chief Investment Officer for Commonwealth Financial Network. “The good news here is that the slowdown will likely keep the Fed on the sidelines going forward.”
“One of their key concerns has been an overheated economy, especially after last quarter’s GDP growth, and this suggests that problem is going away,” he added. “Slower growth is still growth, and this jobs report is still in the sweet spot. We do see signs, however, that more weakness may be ahead.”
The Labor Department also said average hourly employee earnings rose by $0.07 or 0.2 percent to $34.00 in October.
The annual rate of wage growth slipped to 4.1 percent in October from an upwardly revised 4.3 percent in September.
Economists had expected the pace of wage growth to decrease to 4.0 percent from the 4.2 percent originally reported for the previous month.
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