An additional 151,000 jobs were created in the U.S. economy in October, surprising economists with the strength of their numbers, although unemployment remained flat at a rate of 9.6%. Private payroll growth was reported at 159,000, the best since April.
Analysts’ consensus had been for just 60,000 new jobs in the month along with expectations for an unchanged unemployment rate. Still, private companies have continued throughout 2010 to add jobs at a modest rate, reflected by a net 110,000 upward revision over the last three months. Wages also rose in October, by 2% as expected.
“Total nonfarm payroll employment increased by 151,000 in October, reflecting job gains in mining and a number of service-providing industries,” the U.S. Labor Department reported Friday in a news release. “Since December 2009, employment in the private sector has risen by 1.1 million.”
It remains to be seen where U.S. jobs go in November and beyond now that Tuesday’s elections are over and the Federal Reserve has made its Wednesday announcement for plans to buy $600 billion of government bonds. In addition to private-sector jobs’ return to positive territory, the effect this year of temporary U.S. Census government jobs is now disappearing.
U.S. stocks were flat, quiet and mixed Friday morning in response to the jobs data after trending higher earlier in the week, with the Dow Jones industrial average down 5.52 points in midmorning trading, 0.05% lower, at 11,429.32. The S&P 500 was up 4.04 points, 0.33% higher, at 1,225.10. The Nasdaq index fell 0.21 points, 0.01% lower, at 2,577.13.
October’s job gains were all in private services, with business services up a hefty 46,000, though a 53,000 jump in education was twice the underlying trend and won't last, wrote Ian Shepherdson, chief U.S. economist for High Frequency Economics Ltd., in Valhalla, New York, in an analyst note.
He added that retail was up a strong 28,000 while local government jobs were down only 7,000, much better than recent trend, though that number will likely be worse in November.
“Overall, though, very welcome news,” Shepherdson said. “We had not been expecting sustained private payrolls at this pace until next spring, and this could easily be a fluke. But for now it looks good.”
Read about U.S. jobs in September at AdvisorOne.com.