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US Jobs Report October 2024:

The US economy added only 12,000 jobs in October, driven by hurricanes and the Boeing strike

Job creation slowed in October to the weakest pace since late 2020, as the effects of storms in the Southeast and a significant labor gridlock hurt the employment picture.

Nonfarm payrolls rose by 12,000 this month, a sharp decline from September and below the Dow Jones estimate of 100,000, the Bureau of Labor Statistics reported Friday. In what was already expected to be a bleak report, October posted its smallest gain since December 2020.

However, the unemployment rate remained at 4.1%, in line with expectations. A broader measure of unemployment, which includes discouraged workers and those working part-time for economic reasons, was also unchanged at 7.7%.

In the report, the BLS noted that Boeing’s strike likely eliminated 44,000 manufacturing jobs, which lost a total of 46,000 jobs.

In addition, the report noted the impact of Hurricanes Helene and Milton, but said “it is not possible to quantify the net effect” of the storms on total jobs.

Elsewhere, the agency said average hourly wages rose 0.4% this month, slightly above estimates, although the 4% gain over twelve months was in line. The average working week remained stable at 34.3 hours.

However, markets largely ignored the bad news, with stock market futures poised for a strong open on Wall Street while Treasury yields tumbled. The weak jobs data and wages that are roughly in line with expectations will help bring about another interest rate cut by the Federal Reserve next week.

The publication comes just days before the presidential election, in which Democrat Kamala Harris and Republican Donald Trump are locked in what most polls show is a deadlocked race. With the economy at the forefront of the battle, the light job count “casts a dark shadow heading into next week,” said Lisa Sturtevant, chief economist at Bright MLS.

October’s weak report also included substantial downward revisions from previous months. August was reduced to just a gain of 78,000, while September’s initial estimate was 223,000. Together, the net revisions reduced the previously reported total job creation by 112,000.

Healthcare and government again led the way in job creation, with 52,000 and 40,000 jobs respectively. However, several sectors experienced job losses.

In addition to the expected decline in the production sector, temporary emergency services saw a decrease of 49,000. The category is sometimes seen as a measure of underlying employment strength and has seen a decline of 577,000 since March 2022, according to the BLS.

Another leading sector, leisure and hospitality, saw a decline of 4,000, while retail, transport and warehousing also reported a modest decline.

The report covers a month in which Hurricanes Helene and Milton ravaged the southeast of the country – particularly Florida and North Carolina – while the Boeing strike also hit a vibrant but slowing labor market. Recent developments indicate that the impasse at Boeing could be nearing an end.

Prior to publication, job creation in 2024 averaged almost 200,000 per month, about 60,000 less than the pace in the same period a year ago, which is still indicative of a solid hiring pace.

Some rifts in recent months have raised concerns at the Federal Reserve that while the annual rate of inflation is slowing, high interest rates could impact the labor market and threaten continued economic expansion.

As a result, policymakers in September took an unprecedented step for a growing economy and cut their short-term interest rates by half a percentage point, double the usual quarter-point hikes the Fed typically likes to move around.

Financial markets are estimating the likelihood that the central bank will cut spending by a quarter of a percentage point at each of the two remaining meetings this year. The interest rate-setting Federal Open Market Committee will announce its decision next Thursday.

This is the latest news. Check back later for updates.