Job creation slowed more than expected in October in the United States. The slowdown notably reflects the historic strike at the three major American automobile manufacturers. The unemployment rate rose slightly, to 3.9%.
In October, 150,000 jobs were created, less than the 175,000 expected by analysts, and half as many as in September, the Labor Department announced Friday. The health, public employment and social assistance sectors have hired. But ’employment fell in the manufacturing industry due to the strike,’ the press release said.
Employees who had stopped working over the entire period taken into account to calculate employment are in fact not counted as employees, Gregory Daco, chief economist for EY Parthenon, said on Thursday. This represents 33,000 of the more than 45,000 strikers who experienced, at its peak, this unprecedented six-week strike at the three major American automobile manufacturers – General Motors, Ford and Stellantis. It is now coming to an end, after agreements in principle concluded with the UAW union.
The figures for August and September were also revised downwards, and 101,000 fewer jobs than initially announced were created over these two months.
Historically low unemployment
The unemployment rate increased by 0.1 point, to rise to 3.9%. “Employment growth remains positive, wages are slowing and the unemployment rate is near historically low levels,” summarized Rubeela Farooqi, chief economist for HFE, in a note.
‘We expect the labor market to relax and economic activity to slow over time in response to restrictive monetary policy’ from the central bank, the Fed, she said. Because the slowdown in the job market, nevertheless, goes hand in hand with that of inflation. The United States has experienced a significant labor shortage for more than two years, which has caused wages to soar, contributing to inflation.
To combat it, the Fed is pushing on rates to slow down consumption. However, she left them unchanged on Wednesday, as during her previous meeting in September. ‘The labor market remains tight, but supply and demand conditions continue to balance,’ noted Fed Chairman Jerome Powell on Wednesday during a press conference.
‘Reducing inflation will probably require (…) some easing of labor market conditions,’ he warned. Although the situation seems to be gradually rebalancing, employers are still encountering significant difficulties in recruiting.
‘If every unemployed person in the country found a job, we would still have about 3 million jobs available,’ noted Stephanie Ferguson, head of employment issues at the US Chamber of Commerce, in a study published mid -october.
Persistent shortages
“Labor shortages are more persistent” than in 2019, ADP chief economist Nela Richardson also commented on Wednesday during a conference call. Thus, when a sector recruits less, ‘it is difficult to know’ whether it is ‘because companies are hiring less or because they cannot find workers’.
The private sector alone created more jobs in October than in September, the monthly ADP/Stanford Lab survey showed on Wednesday. As for wages, they experienced their lowest increase since the end of 2021, but still increased over one year by 5.7% for workers who kept the same job, and 8.4% for those who changed. .
However, the labor market has, since the summer, seen an influx of new workers, ‘both due to (increase in) participation in the labor market and immigration’, welcomed Jerome Powell on Wednesday , which ‘partly explains why GDP (gross domestic product editor’s note) is so high’. Growth in gross domestic product (GDP) in the United States actually doubled in the third quarter, to 4.9% at an annualized rate.
/ATS
2023-11-03 14:22:33
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