Key information
- Only 12,000 jobs were created in October, which is a significant drop from the 223,000 jobs created in September.
- The unemployment rate remained stable at 4.1 percent.
- Job growth in manufacturing has slowed due to ongoing strikes and hurricane-related disruptions.
U.S. employment growth saw a significant decline in October, primarily attributed to disruptions from hurricanes and strikes. The Labor Department reported that only 12,000 jobs were created last month, in stark contrast to the 223,000 jobs created in September.
Despite this slowdown in hiring, the unemployment rate remained stable at 4.1 percent. These figures, closely followed as indicators of the health of the American economy, are the last published before Tuesday's presidential election. The health care and public administration sectors continued their upward employment trend, but employment growth in manufacturing has slowed due to ongoing strikes.
Impact of strikes
Strikes at major aerospace companies like Boeing, which began in September with 30,000 workers on strike, have had a significant impact on aircraft production. Similar labor actions at Textron, another aircraft maker, also contributed to the slowdown. The Labor Department attributed a drop of 46,000 manufacturing jobs in October, largely because of these strikes, and specifically a drop of 44,000 jobs in the transportation equipment manufacturing sector.
Other sectors and market forecasts
Other large industries saw minimal or no changes in employment throughout the month. Economists had forecast job growth of 113,000, making the actual figure of 12,000 significantly lower than forecast. Excluding strikers from the data likely contributed to the overall decline in nonfarm employment.
Hurricanes Helene and Milton also had an impact on employment figures. These storms, which hit the southeastern United States in late September and early October respectively, caused disruptions and left 512,000 people unable to work due to extreme weather conditions.
Despite this unexpected slowdown, market forecasts still expect the Federal Reserve to cut interest rates by 0.25 percentage points next week. Analysts say the hurricanes' impact on labor market data is temporary and is not expected to significantly influence the Fed's policy decisions. They view the current situation as a short-term setback, with positive prospects for future growth.
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