US employers add 165,000 jobs in October, more than three times the 12-month average

The US Bureau of Labor Statistics (BLS) said nonfarm payrolls rose by 165,000 in October and the unemployment rate was 4.1%, down from 4.2% in September. The gain was more than three times the average of the prior 12 months.

A month that beat the year's pace

The 165,000 increase compares with an average monthly gain of 48,000 over the prior 12 months, the BLS said. Computed from those two figures, October was about 3.4 times the 12-month average.

The BLS also revised the two previous months up. August now stands at +186,000, from +133,000, and September at +60,000, from +29,000. Together, the agency said, employment in the two months is 84,000 higher than first reported.

Offices, clinics and warehouses carried the gain

Professional and business services added 70,000 jobs, against an average monthly gain of 15,000 over the prior 12 months. Health care added 42,000, above its 12-month average of 31,000, with hospitals adding 16,000 and home health care services 11,000.

Transportation and warehousing added 25,000, of which couriers and messengers accounted for 17,000. Manufacturing rose by 19,000. The BLS said employment showed little change over the month in other major industries, including construction, retail trade, financial activities and government.

Unemployment fell, and participation edged up

The number of unemployed people was 7.1 million. The BLS said the unemployment rate has stayed in a narrow range of 4.1% to 4.3% since March. The labor force participation rate rose to 61.9% from 61.8% in September, and the employment-population ratio was 59.3%, from 59.2%.

One figure moved against the grain: the number of people working part time for economic reasons, meaning they wanted full-time work but had hours cut or could not find it, rose by 339,000 to 4.8 million.

Wages rose 0.4% on the month

Average hourly earnings for all private nonfarm employees rose by 14 cents, or 0.4%, to $38.00 in October. Over the past 12 months they have increased by 3.1%. The average workweek stayed at 34.4 hours.

The next Employment Situation report, for November, is scheduled for Friday, December 4, at 8:30 a.m. ET, according to the BLS.

We would not read one strong month as a new trend

We think October is better described as a catch-up than as a turn. A 165,000 gain after two upward revisions sits well above a 12-month average of 48,000, but an unemployment rate that has barely left a 4.1% to 4.3% band since March says the labor market has been tightening only slowly, and a 339,000 jump in involuntary part-time work is a reminder that headline job counts can hide weaker hours. For households the opportunity is steady hiring in health care and services; the threat is that wages rising 3.1% a year leave little room if energy costs keep pushing prices up. We expect the data to stay uneven for the next several months if revisions keep running upward, and a November gain back near the 12-month average would show October was the exception. A sustained rise in unemployment above 4.3% would prove this reading too comfortable.

The view in this final section is FinanceInTime's editorial opinion, for information only. It is not investment, tax, legal or other advice, and it does not take your circumstances into account. Forecasts are uncertain and past results do not guarantee future ones.