The U.S. economy added 165,000 jobs in October, more than double what economists had expected and a sharp reversal from the sluggish hiring seen earlier this year. The Bureau of Labor Statistics report, released Friday, also showed the unemployment rate easing to 4.1% from 4.2% in September, keeping the rate within the narrow 4.1%-to-4.3% band it has held since March.
The gain blew past the roughly 59,000-to-65,000 jobs forecasters had penciled in, and it came with upward revisions that made the prior two months look stronger too: August's initial estimate of 133,000 jobs was revised up to 186,000, and September's was revised up to 60,000 from an initial 29,000, adding a combined 84,000 jobs to the record.
Where the hiring happened
Professional and business services led the gains with 70,000 new jobs, split across technical services, administrative and support roles, and company management. Health care added 42,000 jobs, concentrated in hospitals and home health care. Transportation and warehousing rose by 25,000, driven by couriers and air transportation, and manufacturing added 19,000. Mining, construction, retail, financial activities and government all showed little change.
The report landed at the end of a week in which a midterm-driven selloff in artificial-intelligence stocks briefly pushed the Nasdaq into correction territory before a partial Friday rebound, giving investors a second reason to cheer: evidence the broader labor market was not cracking even as tech valuations wobbled.
Today's jobs report is a strong rebuttal to fears that the economy is heading into a meaningful slowdown.
Seema Shah, Principal Asset Management
Not every read on the data was as upbeat. Tyler Schipper, an economist at the University of St. Thomas, noted that the three-month average pace of job growth is now similar to where it stood earlier in the year, and questioned whether October's jump marks "the beginning of a trend" or just a temporary pickup. He also pointed out that wage growth has stayed mild relative to inflation, meaning many workers may be feeling squeezed even as headline job totals look healthy.
For now, the combination of a better-than-expected jobs number and a stabilizing stock market gives the Federal Reserve a bit more room to avoid an abrupt policy shift at its next meeting, while leaving open the debate over whether October's strength is the start of a durable rebound or a one-month outlier in an otherwise cooling labor market.