The key facts

  • October US job growth was 165,000 versus expectations of 65,000; unemployment fell to 4.1%
  • Data for August and September were revised upward by a combined 84,000 jobs
  • Average hourly earnings rose 0.4% to $38.00, with annual wage growth at 3.1%

US labor market exceeds expectations

The US economy added 165,000 jobs in October, well above market expectations of 65,000, while the unemployment rate fell to 4.1%. The Bureau of Labor Statistics released the figures on Friday, Anadolu reports. Job growth accelerated compared with September, where the gain stood at 60,000 after revisions, and exceeded the average monthly increase of 48,000 over the previous 12 months.

Who was hiring and how past data were revised

Professional and business services led the gains (+70,000), followed by health care (+42,000) and transportation and warehousing (+25,000); manufacturing employment rose by 19,000. Revisions to previous months proved substantial: August data were revised up by 53,000 to 186,000, and September by 31,000 to 60,000. In total, the revisions added 84,000 jobs to previously published figures.

Wages and the signal for the Fed

Average hourly earnings in the private nonfarm sector rose by $0.14, or 0.4%, to $38.00, consistent with annual wage growth of 3.1%. The average workweek held steady at 34.4 hours. According to the outlet, stronger hiring and upward revisions could give the Federal Reserve more room to focus on curbing inflation, as the labor market appears resilient; at the same time, monthly wage growth may draw the attention of policymakers assessing price pressures. The Fed takes the state of the labor market into account alongside inflation when setting rates, pursuing maximum employment and a long-term inflation target of 2%.

The other side of the statistics

The number of unemployed people was nearly unchanged at 7.1 million, and the labor force participation rate stood at 61.9%. Meanwhile, the number of people working part-time due to reduced hours or the inability to find full-time work rose by 339,000 to 4.8 million, pointing to hidden underemployment even against the backdrop of a strong report.