US job growth tops expectations in October

In October, U.S. employment grew by 165,000 jobs, significantly surpassing analysts' expectations, according to government data released on Friday. The unemployment rate fell to 4.1%, as reported by the Bureau of Labor Statistics (BLS). The robust job market has led the Federal Reserve to prioritize combating persistent high inflation, which may pressure the central bank to raise interest rates further. This stance puts the Fed at odds with President Donald Trump, who has frequently called for lower borrowing costs.

The BLS also revised upward job figures for August and September by a combined 84,000 positions, updating the previous data to reveal that the U.S. economy added 60,000 jobs in September, not the initially reported 29,000. Analysts had anticipated 65,000 new jobs and a 4.2% unemployment rate, based on a consensus forecast.

Ger Doyle, North America regional president at staffing firm ManpowerGroup, noted that the strong October report signals momentum in the labor market. However, Doyle emphasized that more industries need to experience hiring growth before declaring a broader recovery.

The gain in October was notably higher than the monthly average of 48,000 over the past year. The professional and business services sector led job growth, adding 70,000 jobs, far exceeding its usual monthly increase of 15,000. Healthcare also expanded, with 42,000 new jobs, surpassing its typical monthly gain of 31,000. Transportation and warehousing added 25,000 positions, primarily in courier and messenger roles, while manufacturing contributed 19,000 jobs.

Other major sectors, such as construction, retail, financial activities, and government, witnessed little to no change. Despite the positive employment data, average hourly earnings for all employees increased by 3.1% over the past year, yet wages have lagged behind high inflation, resulting in most workers experiencing real wage losses.