October job growth soars past Wall Street's expectations, brushing off GM strike
U.S. hiring was unexpectedly solid in October, as the economy added 128,000 jobs, brushing off the weight of the 40-day General Motors strike.
The payroll number far exceeded the estimate of 89,000 from economists surveyed by Refinitiv (the lowest forecast in more than two years), even with a decline of 42,000 jobs in motor vehicles and parts manufacturing because of the workers' strike and 20,000 temporary census workers leaving their jobs.
The unemployment rate edged slightly higher to 3.6 percent as more people were looking for work, but continued to hover near a 50-year low. The labor force participation rate was little changed at 63.3 percent. Average hourly earnings, meanwhile, rose by 3 percent over the past year to $28.18.
The report further alleviates concerns that the U.S. economy is teetering on the brink of a recession, and reinforces the Federal Reserve's characterization of the labor market as "strong". It also affirms the central bank's decision to press pause on further interest rate cuts this year, after it voted this week to lower the benchmark federal funds rate for the third time.
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"As long as consumers feel confident, the economy should stay on track," said Tony Bedikian, managing director of Citizens Bank.
Food services and drink establishments accounted for the biggest job creation, adding 48,000 new positions. It was followed by professional and business services, which added 22,000 jobs, and health care, which increased by 15,000.
In another boon to the economy, revisions added 95,000 jobs for the prior two months, bringing the three-month average to 176,000.
President Trump lauded the report on Twitter, calling it a "blowout" number.
"Wow, a blowout JOBS number just out, adjusted for revisions and the General Motor strike, 303,000," he wrote. "This is far greater than expectations. USA ROCKS!"