U.S. job growth slowed more than expected in October, in part because strikes by the United Auto Workers (UAW) union against Detroit’s Big Three automakers weighed on manufacturing payrolls, while wage inflation has slowed, indicating easing labor market conditions.
Nonfarm payrolls increased by 150,000 jobs last month, the Labor Department’s Bureau of Labor Statistics (BLS) said in its closely watched jobs report released Friday. Data for the month of September were revised downwards and show 297,000 jobs created instead of the 336,000 previously announced.
MARKET REACTION:
STOCK MARKET: US stock futures rose after the jobs report was released. BONDS: The 10-year US Treasury yield fell to a three-week low following the release of the jobs report, with the latest yield standing at 4.562%.
FOREX: The dollar index fell after the weaker-than-expected jobs report.
COMMENTS:
BRIAN JACOBSEN, CHIEF ECONOMIST, ANNEX WEALTH MANAGEMENT, MENOMONEE FALLS, WISCONSIN
“The employment situation is still good, but it is no longer excellent. It is not that bad. It could, however, get worse. Only 52% of private industries reported employment increases, which is much less than the 61.4% in September. There is not much amplitude in the markets and there is no longer much amplitude in job creation.”
“Wage growth is positive, but nothing to worry about from an inflation perspective. Job gains have been decent despite the auto strikes. Month-over-month revisions have been substantial, as the BLS has consistently overestimated job gains this year, unlike last year when it consistently underestimated gains. It’s a world that’s good for bonds, but cloudy at best for actions.
PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK
“Ultimately, this is a low ratio, although some of it can be attributed to the (UAW) strike. But hourly wages only increase 0.2 percent and the rate participation fell to 62.7%.
“It’s a good sign that the labor market is weakening and that works in favor of the Fed. This should be positive for stocks.”
“This likely indicates another Fed pause in December, which would mean the Fed is done raising rates.”
2023-11-03 12:49:06
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