Employment increased substantially in October, making up for the job loss in September, according to the latest release from the U.S. Bureau of Labor Statistics.
Last month, employment plummeted in the wake of hurricanes Harvey and Irma to a level no expert predicted it would fall in September – a loss of 33,000.
And this increase to make up for September’s loss is exactly what experts predicted.
“While September’s employment report was a real shocker on paper, the markets merely shrugged it off as nothing more than a glitch due to the hurricanes which hit both Texas and Florida,” NerdWallet mortgage expert Tim Manni said. “The October job’s number will be a massive correction, considering September was the first negative employment figure in seven years.”
Total nonfarm payroll employment increased 261,000 in October, up from a loss of 33,000 the month before. However, the new report revised September’s loss of 33,000 up to a gain of 18,000 jobs.
Another expert agreed the housing market expected a surge in job growth, but said even the increase of 261,000 jobs fell short of expectations.
“The October jobs report was modestly positive, on net,” said Curt Long, National Association of Federally Insured Credit Unions chief economist. “Job growth fell slightly below expectations, but when paired with the sizable upward revisions to prior month data, the results were solid.”
“However, wage growth and labor force participation both slipped during the month,” Long said. “The data is likely to continue to be choppy for the next few months due to weather impact, but this report was strong enough to keep the Fed on track for a rate hike in December.”
Another expert agreed, calling this jobs report a base hit when the industry was expecting a home run.
“We were expecting a home run in this month’s jobs report, but got a base hit,” Redfin Chief Economist Nela Richardson said. “Slow wage growth in the construction sector, which has had extreme labor shortages for many months, is particularly troubling.”
“The fact that we still are not seeing upward pressure on wages in the midst of a huge rebuilding effort in Houston and Florida signals continued labor sluggishness in the broader market,” Richardson said.
The market saw its largest gain in food services and drinking places which increased sharply, offsetting a decline in September from the hurricanes.
Here are some of the areas which showed major changes in September:
- Employment in restaurants increased by 89,000
- Employment in professional and business services increased by 50,000
- Manufacturing increased by 24,000
- Employment in health care increased by 22,000
Employment in other major industries, including mining, construction, wholesale trade, retail trade, transportation and warehousing, information, financial activities and government, changed little in October.
The unemployment rate inched down by 0.1 percentage point to 4.1% in October, bringing the number of unemployed down 281,000 to 6.5 million people. This marks a decrease of 0.7 percentage points, or 1.1 million people, since January.
The average workweek for all employees on private nonfarm payrolls remained unchanged at 34.4 hours. The same is true for average hourly earnings, which slipped one cent to $26.53 in October.
