The Bureau of Labor Statistics reports that in October, nonfarm payroll employment increased by 165,000. On the face of it, these are solid — but not spectacular — gains. However, as we have discussed in earlier posts, trends in labor market participation and — most importantly — population growth have changed the number of job gains necessary to maintain an unchanging unemployment rate. Indeed, the unemployment rate nudged down from 4.18% in September to 4.14% in October.
Average weekly hours remained at 34.4 and therefore, along with private employment, total hours of work increased.
Unemployment insurance initial claims numbers suggest that the unemployment rate is unlikely to change much in the near future.
Those entering unemployment can be categorized as those: (a) leaving their jobs voluntarily, (b) losing their jobs involuntarily, (c) reentering the labor force, and (d) new entrants to the labor force. While new entrants have been trending up over the past several years, the other categories have been flat. On the other end, the number of persons unemployed 27 weeks or longer has been rising.
The Job Openings and Labor Turnover was also released this week and showed a slight increase in the job openings rate as well as the quit rate.
Overall, the labor market remains strong. With the recent spike in inflation it seems more than likely that the Fed will raise rates at the next, maybe the next few, meetings.
