U.S. job growth rebounded sharply in October and wages recorded their largest annual gain in 9-1/2 years, pointing to further labor market tightening that could encourage the Federal Reserve to raise interest rates again in December.
The Labor Department’s closely watched monthly employment report on Friday also showed the unemployment rate steady at a 49-year low of 3.7 percent as 711,000 people entered the labor force, in a sign of confidence in the jobs market.
Sustained labor market strength could ease fears about the economy’s health following weak housing data and stalling business spending. President Donald Trump cheered the robust report, which came less than a week before the midterm elections that will decide who controls the U.S. Congress.
“These are incredible numbers,” Trump tweeted.
Nonfarm payrolls increased by 250,000 jobs last month as employment in the leisure and hospitality sector bounced back after being held down by Hurricane Florence, which drenched North and South Carolina in mid-September.
There were also big gains in manufacturing, construction and professional and business services payrolls…
Employers, scrambling to find qualified workers, are boosting wages. There are a record 7.14 million open jobs.
Employment gains have averaged 218,000 jobs per month over the past three months, double the roughly 100,000 needed to keep up with growth in the working-age population.
The labor force participation rate, or the proportion of working-age Americans who have a job or are looking for one, increased two-tenths of a percentage point to 62.9 percent last month.
Among people ages 25 to 54, when decisions about school or retirement are less likely to influence whether people are in the work force, 82.3% are participating in the labor force and 79.7% have jobs. Both figures are now at their highest levels since the recession and its immediate aftermath.
Professional services and health care have continued to be the biggest drivers of job growth, but the construction and manufacturing industries have both posted solid gains over the past year.