The economy added 271,000 jobs in October, the Labor Department reported Friday, increasing the already-substantial likelihood of a Fed rate hike next month.
With one jobs report to go before the Federal Reserve Board’s Open Markets Committee meets in mid December, Friday’s numbers were not the last word. But the October jobs numbers were way up from September’s increase of 137,00 jobs, an estimate that the Labor Department adjusted downward Friday from its initial estimate of 142,000. Unemployment was 5 percent, essentially unchanged from September’s 5.1 percent, and average hourly private-sector earnings were up a robust 9 cents. In September, they were down a penny.
Even before the release of the October jobs numbers Fed Chair Janet Yellen had said she expected an interest-rate hike by year’s end, which would be the Fed’s first since 2006.
Analysts predicted the creation of about 190,000 jobs, an unemployment rate of 5 percent, and an increase in hourly earnings of 0.2 percent, according to a Bloomberg survey of economists. The payroll company ADP estimated Wednesday based on its own records that October job growth in the private sector was 182,000, down from its September calculation of 200,000.
The jobs report followed news last week from the Commerce Department that GDP increased 1.5 percent during the third quarter of 2015, a significant decline from the second quarter’s 3.9 percent. The Commerce Department’s second cut at estimating third-quarter growth will be released Nov. 24.
Labor force participation remained low, at 62.4 percent, the same as in September. That figure, and the 62.6 percent rate for June, July and August, put labor participation at or near its lowest level since the 1970s.
