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Jobs report: U.S. economy adds 128,000 jobs in October, smashing expectations

Emily McCormick · Reporter
4 min read

In This Article:

The U.S. economy added more jobs than expected in October, handily topping estimates even as a protracted strike was anticipated to weigh on hiring growth.

The unemployment rate held near a 50-year low, and wage increases picked up slightly.

The Bureau of Labor Statistics released its latest print on the U.S. employment situation Friday at 8:30 a.m. ET. Here were the main metrics from the report, compared to consensus economist expectations compiled by Bloomberg:

  • Change in non-farm payrolls: +128,000 vs. +85,000 expected and 180,000 in September

  • Change in manufacturing payrolls: -36,000 vs. -55,000 expected and -5,000 in September

  • Unemployment rate: 3.6% vs. 3.6% expected and +3.5% in September

  • Average hourly earnings month-on-month: +0.2% vs. +0.3% expected and 0.0% in September

  • Average hourly earnings year-on-year: +3.0% vs. +3.0% expected and 3.0% in September

The October jobs report reflected the impact of a 40-day United Auto Workers (UAW) strike against General Motors (GM), which lasted from September 16 through October 26. This extended over the survey weeks for both the BLS establishment and household surveys, which captured the calendar and pay period week, respectively, that included the 12th day of the month.

Spanish Fork, UT, USA – August 3, 2017: Road construction worker scoups up concrete while cleaning up a center medium just laid in Spanish Fork, Utah. Other workers smooth out the center medium with a float
Spanish Fork, UT, USA – Road construction worker scoops up concrete while cleaning up a center medium just laid in Spanish Fork, Utah.

Forty-six thousand workers were counted as part of the strike, according to the BLS strike report last Friday.

However, the strike had less of a dampening effect than expected on the BLS establishment survey, which includes metrics including the change in non-farm payrolls.

“Manufacturing employment decreased by 36,000 in October,” the BLS said in its October report. “Within manufacturing, employment in motor vehicles and parts declined by 42,000, reflecting strike activity.”

Consensus economists had anticipated, on net, a loss of 55,000 manufacturing payrolls, steepening sharply from a revised loss of 5,000 in September, as both the strike and ripple effect on GM’s suppliers was expected to cut into results.

The BLS report comes on the heels of a private report from ADP/Moody’s Wednesday, which showed private payrolls rose by 125,000 in October, or 15,000 better-than-expected. Due to differences in methodology from the BLS establishment survey, the ADP report typically does not capture the impact of striking workers.

The Labor Department’s household survey – which includes the unemployment rate and labor force participation rate – was not impacted by the strike, since this portion of the report counts striking workers as only temporarily laid off. Within this survey, results remained strong.

The unemployment rate edged up just slightly to 3.6%, or just a hair above September’s unrevised 50-year low of 3.5%. The labor force participation rate unexpectedly rose to 63.3%, reflecting the largest share of the working population employed or looking for work since 2013.

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