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The U.S. economy added more jobs than expected in October, handily topping estimates even as a protracted strike was anticipated to weigh on hiring growth.
The unemployment rate held near a 50-year low, and wage increases picked up slightly.
The Bureau of Labor Statistics released its latest print on the U.S. employment situation Friday at 8:30 a.m. ET. Here were the main metrics from the report, compared to consensus economist expectations compiled by Bloomberg:
Change in non-farm payrolls: +128,000 vs. +85,000 expected and 180,000 in September
Change in manufacturing payrolls: -36,000 vs. -55,000 expected and -5,000 in September
Unemployment rate: 3.6% vs. 3.6% expected and +3.5% in September
Average hourly earnings month-on-month: +0.2% vs. +0.3% expected and 0.0% in September
Average hourly earnings year-on-year: +3.0% vs. +3.0% expected and 3.0% in September
The October jobs report reflected the impact of a 40-day United Auto Workers (UAW) strike against General Motors (GM), which lasted from September 16 through October 26. This extended over the survey weeks for both the BLS establishment and household surveys, which captured the calendar and pay period week, respectively, that included the 12th day of the month.
Forty-six thousand workers were counted as part of the strike, according to the BLS strike report last Friday.
However, the strike had less of a dampening effect than expected on the BLS establishment survey, which includes metrics including the change in non-farm payrolls.
“Manufacturing employment decreased by 36,000 in October,” the BLS said in its October report. “Within manufacturing, employment in motor vehicles and parts declined by 42,000, reflecting strike activity.”
Consensus economists had anticipated, on net, a loss of 55,000 manufacturing payrolls, steepening sharply from a revised loss of 5,000 in September, as both the strike and ripple effect on GM’s suppliers was expected to cut into results.
The BLS report comes on the heels of a private report from ADP/Moody’s Wednesday, which showed private payrolls rose by 125,000 in October, or 15,000 better-than-expected. Due to differences in methodology from the BLS establishment survey, the ADP report typically does not capture the impact of striking workers.
The Labor Department’s household survey – which includes the unemployment rate and labor force participation rate – was not impacted by the strike, since this portion of the report counts striking workers as only temporarily laid off. Within this survey, results remained strong.
The unemployment rate edged up just slightly to 3.6%, or just a hair above September’s unrevised 50-year low of 3.5%. The labor force participation rate unexpectedly rose to 63.3%, reflecting the largest share of the working population employed or looking for work since 2013.
Where the jobs are
Manufacturing payrolls aside, a number of private service-providing industries saw solid job gains in October.
Of these, leisure and hospitality and added the most positions at 61,000 jobs for the month, up from September’s 45,000. The category overtook education and health services for the largest grower of private employment in October. These industries added 39,000 positions, led by health-care and social assistance job additions at 34,200.
On the other hand, federal government employment fell by 17,000 for the month, reflecting 20,000 temporary workers who had been hired for the 2020 census leaving their jobs.
In addition to October’s estimates-topping headline payrolls additions, August’s and September’s payrolls figures were also upwardly revised. Non-farm payrolls in August were upwardly revised by 51,000 to 219,000, while September’s were revised up by 44,000 to 180,000.
These revisions brought employment gains between the two months to 95,000 higher than previously reported. Job gains have now averaged 176,000 over the past 3 months.
For the year-to-date, however, job gains have slowed compared to last year. New payrolls have averaged 167,000 so far this year, compared to 255,600 in the first 10 months of 2018.
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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