This morning’s national Employment Situation Report for the month of October was rather positive. In October, 128,000 jobs were added — well above the 98,000 jobs expected. However, the October report did reflect the impact of the General Motors (GM) strike, a 40-day United Auto Workers (UAW) which was still in place during the week of the BLS survey. The precise consequence of that is tricky as there may be affected workers outside the narrow manufacturing sector, but the general expectation was on the order of 50K workers, and the BLS reports a drop of 42,000 jobs in auto manufacturing employment. Revisions to the previous two months added an additional 96,000 jobs.
Only two sectors lost jobs: Manufacturing, which could be attributed to the strike, and Government, where census-related temporary employment dropped by 20,000. The census will be a volatile and distorting factor in the jobs report throughout its duration. Food services, social assistance, financial activities, business and professional services, and health care all saw gains. Other sectors were essentially flat.
The headline unemployment rate, U3, ticked up to 3.6%, which matched expectations. The broadest measure of labor underutilization, U6, also ticked up 0.1 percentage points to 7.0%. Average hours earnings moved up slightly more than expected.
Overall, this is a positive report. Earlier this week we saw a GDP number that was both above expectations, and consistent with an overall slowing economy. Today’s report seems consistent with that story.
