US employers pulled back on hiring in October, adding 150,000 jobs in face of higher borrowing rates
WASHINGTON — The nation’s employers slowed their hiring in October, adding a modest but still decent 150,000 jobs, a sign that the labor market may be cooling but remains resilient despite high interest rates that have made borrowing much costlier for companies and consumers.
Last month’s job growth, though down sharply from a robust 297,000 gain in September, was solid enough to suggest that many companies still want to hire and that the economy remains sturdy. And job growth would have been higher in October if not for the now-settled United Auto Workers’ strikes. The strikes ended this week with tentative settlements in which against Detroit’s automakers granted significantly better pay and benefits to the union’s workers.
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Friday’s jobs report from the government comes as the Federal Reserve is assessing incoming economic data to determine whether to leave its key interest rate unchanged, as it did this week, or to raise it again in its drive to curb inflation. The lower job growth in October, along with a slowdown in pay gains last month, could help convince the Fed that inflation pressures will continue to cool and that further rate hikes may not be needed.
On Wall Street, traders appeared to signal their growing belief in that scenario. Bond yields fell and stock prices rose sharply after the jobs report was released, indicating optimism that the Fed will decide it won’t need to impose additional rate hikes.
The unemployment rate rose last month from 3.8% to 3.9%. And in another sign of a possible softening in the labor market, the Labor Department revised down its estimate of job growth in August and September by a combined 101,000.
The UAW strikes contributed to an overall loss of 35,000 factory positions in October. Several other sectors posted solid job gains last month, notably healthcare, which added 58,000, government agencies 51,000 and construction companies 23,000.
By contrast, the vast leisure and hospitality sector, which includes bars, restaurants and hotels, reported only modest job growth. So did professional and business services, a category that includes such high-paying occupations as accounting, engineering and architecture.
Wage pressures, which have been gradually slowing, eased further in October. Average hourly pay rose 0.2%.
