U.S. Employment increases by 12,000 jobs in October
KEY TAKEAWAY: According to the Bureau of Labor Statistics (BLS), employment growth in the U.S. was dampened by the damage caused by Hurricanes Helene and Milton in the Southeast. In October 2024, employment increased by only 12,000, while the unemployment rate remained steady at 4.1%. Since the payroll survey does not track the temporary effects of extreme weather events, it is challenging to accurately measure the monthly changes in national employment, hours, or earnings as if these events had not happened.
Employment
Hurricane Impact: Due to the extraordinary circumstances caused by the weather events occurring between the September and October survey periods, the latest jobs report cannot be used to draw strong conclusions about the direction of the labor market. The heaviest job losses were in the Manufacturing and Professional & Business Services sectors. Look for these industries to have the biggest employment rebounds over the next few months.
Diving In: When state and local payroll statistics are released later this month, we should have a better idea of the labor market effects of the hurricanes by homing in on the geographic areas that were in the path of these destructive storms.
Unemployment
In Brief: The unemployment rate is produced by a separate household survey which does not count respondents who were unemployed due to weather-related reasons. Therefore, the BLS stated that there should be no detectable impacts of the hurricanes on this figure.
The employment numbers above reflect the seasonally adjusted, monthly change in non-farm jobs.
The unemployment rate measures the percentage of the labor force that is currently without a job. The national unemployment rate has remained steady throughout 2023 and now into 2024, fluctuating between 3.7% and 4.1%.
U-3 unemployment rate is the most commonly reported rate in the United States, representing the number of unemployed people actively seeking a job. The U-6 rate covers discouraged, underemployed, and unemployed workers in the country.
The labor force participation rate is an estimate of an economy’s active workforce. YTD the U.S. labor force participation rate ranged between a low of 62.5% and a high of 62.8%, according to the U.S. Bureau of Labor Statistics.
How We Matched Up
Geographic Solutions: Geographic Solutions' expectations of 112,000 jobs were well above of the 12,000 jobs added in October, due to the uncertainty of the hurricanes. The unemployment rate expectation of 4.0% was below the 4.1% result.
The Wall Street Journal: The Wall Street Journal's expectation of 100,000 jobs being added to the labor market was also far above what was recorded in the labor market report. The unemployment rate forecast of 4.1% was correct.
ADP: According to ADP’s latest estimate, the private sector added 233,000 jobs in October, compared to the -28,000 reported by the BLS.
Key Takeaway: While Private Education & Health Services added the highest number of jobs in August (81,000) it was about even with its average job growth over the previous 12 months (75,000). The best performances compared to their recent histories were in Leisure & Hospitality (78,000), outperforming its 12-month average by 54,000.
Why: Employment in food services and drinking places (restaurants and bars) has sharply increased over the last two months, and it made up more than 88%of all job creation in Leisure & Hospitality for September.
Stock Down: Information and Public Sector
Key Takeaway: The Manufacturing Sector was down this past month with 7,000 jobs lost. The Public Sector disappointed with only 31,000 jobs for the month when its 12-month average was 41,000.
Why: Job declines within Manufacturing were most severe in transportation equipment manufacturing (-5,200). Employment in the federal government was flat, weighing down the public sector. Both sectors were the only major ones to experience employment growth that was below their sectors’ averages over the previous 12 months.
Will job creation remain robust over the coming months?
Based on the numbers from the latest report, we anticipate employment growth will slow down but will continue to add jobs at a slower pace in the coming months. This indicates that businesses are still looking to expand but more gradually.
Do workers or employers have more power in the labor market?
Neither side has a definitive upper hand, but it appears that the decline in unfilled job openings is giving employers more influence in the job market.
How has the labor market shifted since March 2023?
The labor market has continued to add jobs without slowing down despite widespread expectations of a recession.
Geographic Solutions derives its employment forecast and unemployment rate forecast from internal data on the number of job openings, searchers, and employment and unemployment applications filed on Geographic Solutions' state client sites. The forecast uses unemployment claims data from the U.S. Department of Labor (USDOL).
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