Recent Updates

  • UK: Lloyds TSB Business Barometer (Nov)
  • China: Steel PMI, Manufacturing PMI, Nonmanufacturing PMI (Nov)
  • New Zealand: ANZ Business Outlook Survey (Nov)
  • Australia: Assets & Liabilities of ADIS (Oct), External Debt, International Investment Position, BOP (Q3)
  • more updates...

Economy in Brief

U.S. Payroll Growth Rebounds; Wage Gains Ease & Jobless Rate Declines in October
by Tom Moeller  November 5, 2021

• Hiring improvement exceeds expectations.

• Average hourly earnings growth slows m/m.

• Jobless rate declines to lowest since March 2020. Labor force expands modestly.

As the spread of the Delta virus lessened, the job market improved last month. Nonfarm payroll employment increased 531,000 (3.9% y/y) following a 312,000 September gain, revised from 194,000. The August rise of 483,000 was revised from 366,000. A 413,000 rise had been expected in the Action Economics Forecast Survey.

Average hourly earnings rose an expected 0.4% last month (4.9% y/y) following a 0.6% increase in September.

The unemployment rate declined to 4.6% in October from 4.8% in September. A 4.7% rate had been expected. The labor force rose 104,000 last month after falling 183,000 in September. Employment in the household survey rose 359,000, the weakest increase since a decline in June. The overall unemployment rate, including those who were marginally attached or working part-time for economic reasons, fell to 8.3% from 8.5%. It was the lowest level since February of last year and compared to a recession high of 22.9%.

The rise in payroll employment picked up last month due to widespread improvement in the private sector where payrolls rose 604,000 (4.5% y/y). Private service sector hiring rose 496,000 in October (4.8% y/y) after a 300,000 September gain. The level of hiring in trade, transportation & public utilities rose 104,000 last month (3.2% y/y) after a 122,000 increase, as hiring in retail trade gained 35,300 (2.4% y/y). Leisure & hospitality sector rose 164,000 (13.4% y/y) which nearly doubled the September rise. Professional & business sector employment strengthened 100,000 (5.2% y/y) as temporary employment rose 41,100 (11.3% y/y). Education & health services employment strengthened 64,000 (2.1% y/y) after rising 13,000 in September. Information services jobs rose 10,000 in October (5.0% y/y) while financial sector employment gained 21,000 (1.7% y/y).

Factory sector employment rose 60,000 last month (3.1% y/y) and doubled the September rise. Construction sector payrolls improved 44,000 (2.2% y/y) while employment in the mining & logging industry rose 4,000 last month (9.9% y/y).

Government sector payrolls declined 73,000 in October (+1.0% y/y) after falling 53,000 during September. Local government employment fell 45,000 (+1.9% y/y) while the number of state government jobs declined 25,000 (+1.2% y/y). Federal government payrolls eased 3,000 (-3.3% y/y).

Average hourly earnings improved 0.4% after rising 0.6% in September. The 4.9% y/y gain was the quickest since February. Earnings in the leisure & hospitality sector strengthened 1.0% (11.2% y/y). Professional & business service sector pay rose 0.7% (5.7% y/y). Earnings in education & health services rose 0.2% (5.9% y/y) while financial sector pay rose 0.7% (4.9% y/y). Factory sector pay improved 0.4% (4.5% y/y) while construction sector earnings also firmed 0.4% (4.7% y/y).

The length of the average workweek slipped to 34.7 hours from 34.8 hours in September. The financial sector workweek held at 37.5 hours for the third straight month as the information sector workweek held at 36.8 hours, the least since November 2020. Hours-worked in the professional & business service sector were unchanged at 36.7 and the education & health services workweek was stable also at 33.4 hours. The leisure & hospitality workweek held at 26.2 hours for the third straight month. The factory sector workweek dipped to 40.3 hours, the shortest since June. The construction workweek fell sharply to 38.7 hours and reversed its September surge.

From the household employment survey, the lower 4.6% unemployment rate in October occurred as the labor force participation rate held at 61.6% and remained below the 63.4% high in January of last year. The teenage participation rate was little changed at 36.4, but for individuals aged 20-24, it rose to 71.3%, the highest level since February 2020. For workers aged 25-54, the rate edged up to 81.7% and remained below the January 2020 high of 83.0%. For men aged 25-54, the rate held at 88.1%. For women of that age, the participation rate improved to 75.4% but was down from the January 2020 high of 76.9%. For workers aged 55 & over, the participation rate slipped to 38.4% and remained below the July-2019 high of 40.5%.

The employment/population ratio for all workers rose to 58.8% in October but remained well below the February 2020 high of 61.1%. A lessened 18.1 million worked at home because of the coronavirus, down 43.5% y/y.

The average duration of unemployment fell to 26.7 weeks in October from 28.4 in September, but remained well above 21.4 weeks twelve months earlier. The median unemployment duration fell sharply to 12.0 weeks, down from 19.8 weeks in June.

The teenage unemployment rate rose to 11.9% last month but remained below the record 32.1% in April of last year. The rate for workers aged 20-24 declined to 7.5% in October from 8.0% in September. For workers aged 25-54, the rate fell to 4.2% and remained down from last April's high of 12.8%. For those over 55, the jobless rate held at an expansion low of 3.6%.

By educational attainment, the rate of unemployment of workers without a high school diploma fell in October to 7.4% and remained below the 9.9% rate one year earlier. High school graduates without any college were a lessened 5.4% unemployed last month, down from the April 2020 high of 17.3%. Those with some college but no degree were unemployed at 4.4%, down sharply from the April 2020 peak of 15.0%. College graduates saw their unemployment rate ease to 2.4% last month but it remained above the 1.9% low in February of last year.

The employment & earnings data are collected from surveys taken each month during the week containing the 12th of the month. The labor market data are contained in Haver's USECON database. Detailed figures are in the EMPL and LABOR databases. The expectations figures are in the AS1REPNA database.

Employment (SA, M/M Change, 000s) Oct Sep Aug Oct Y/Y 2020 2019 2018
Payroll Employment 531 312 483 3.9% -5.8% 1.3% 1.6%
 Previous Estimate -- 194 366 -- -- -- --
  Manufacturing 60 31 49 3.1 -5.0 1.0 2.0
  Construction 44 30 -1 2.2 -3.0 2.8 4.6
  Private Service-Producing 496 300 450 4.8 -6.6 1.4 1.5
  Government -73 -53 -21 1.0 -3.1 0.7 0.5
Average Weekly Hours - Private Sector 34.7 34.8 34.6 34.8 34.6 34.4 34.5
Private Sector Average Hourly Earnings (%) 0.4 0.6 0.4 4.9 4.8 3.3 3.0
Unemployment Rate (%) 4.6 4.8 5.2 6.9 8.1 3.7 3.9
close
large image