The unemployment rate dropped to 5.8% as the U.S. economy added 214,000 jobs in October.
Though the jobless rate fell 0.1 points from September, employers added fewer jobs than expected, as analysts had predicted employers would add 235,000 to their payrolls.The report indicates that the U.S. economy is continuing to improve steadily, though the pace of the jobs recovery slowed slightly compared to the past year, when employers added an average of 227,000 jobs per month.
The retail trade, food services, and health care industries helped drive the growth in October jobs, though there was a notable slowdown in professional and business services, which added only 37,000 jobs in October compared to 55,000 in September and 53,000 jobs at the same time last year.
That said, it’s notable that full-time jobs led last month’s recovery. The number of people working part-time for economic reasons—because they can’t find full-time work or their hours were cut back—declined by 76,000 in October. At the same time, “full time jobs rose by 551,000 of the 683 ,000 total rise in household jobs,” said Stuart Hoffman, chief economist for PNC Financial Services Group. “Thus, the majority of jobs added by private employers last month were full time.”
Wage growth failed to pick up steam, however. Average hourly earnings rose 3 cents to $24.57, and the wage growth rate for the past year remained at 2%. Some analysts have predicted that wage growth would finally begin to accelerate as the labor market tightened, but that’s yet to come to pass.
“The economy may be growing, but not enough for workers to feel the effects in their paychecks,” said Elise Gould of the Economic Policy Institute.
The labor force participation rate remained largely unchanged at 62.8%—slightly higher than in September—which means that that the unemployment rate didn’t fall in October simply because more people have given up looking for work. The participation rate remains at historic lows, but it’s also being depressed by larger structural and demographic forces, as more Baby Boomers are retiring and more young people are pursuing higher education.
House Speaker John Boehner (R-Ohio) was unsurprisingly sour on the new jobs data. He said in a statement:
“While it’s welcome news that more people found work last month, wages remain stubbornly flat while costs continue to rise, squeezing middle class families and putting the American Dream further out of reach. We’re listening, and we’ll continue making Americans’ priorities our priorities by advancing solutions to strengthen the economy, lower costs, and expand opportunity.