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Jobs Up 171K in October as Most Sectors Show Growth

by Nov 2, 2012, 9:49 am ET

The economy added 171,000 jobs in October, far more than economists were expecting, while the unemployment rate ticked up slightly to 7.9 percent, a development many expected.

With most sectors showing job increases, including a 13,000 rise in manufacturing jobs and 17,000 in the beleaguered construction industry, this morning’s report from the U.S. Department of Labor was one of the strongest in months. In addition to the 184,000 non-farm, private sector jobs created in October (offset by losses in government job), the report adjusted upward the initial numbers for September and August by 84,000.

Surveys of economists in the days before this morning’s report had them forecasting the rise in the unemployment rate, but expecting job growth to be in the area of about 125,000 jobs. Yesterday, payroll processor ADP said its own analysis put October’s growth closer to 158,000. That helped send stock prices higher, although economists, wary of ADP’s track record at predicting the government report, largely stuck by their initial predictions.

But the jobs report has turned those predictions on their head. It shows more strength in more sectors than nearly anyone was expecting. In the retail sector, for instance, most categories added jobs, with motor vehicles and parts dealers adding 7,300 jobs. Retail overall was up 36,400 jobs.

In the professional and business services sector, a broad category encompassing employment and temp firms (up by 15,800) to computer system design (up 6,600) and building services such as janitorial (up 13,300), the overall job count grew by 51,000. It was the largest of all the sector increases, surpassing even the 32,500 jobs added in healthcare.

Although the unemployment rate increased, the number of out-of-work Americans –  12.3 million — was unchanged from September. The 5 million who have been out of work for more than half a year was also unchanged. Another 8.3 million people are working part-time because they can’t find full-time work, and 2.4 million more want work, but because they didn’t search for it during the survey period, aren’t included in the counts of the unemployed.

The Wall Street Journal observed that a broader — and some would say better — measure of unemployment fell to 14.6 percent from September’s 14.7 percent. This so-called U-6 report combines all the different counts of partially employed, unemployed, and the marginally attached.

The Journal said the main unemployment rate increase “was driven by positive factors.” These were an increase in the number of workers deciding to rejoin the labor force and start looking for work. “That could be a sign of confidence in the state of the labor market,” the Journal said, a sign borne out by increases in various measure of consumer confidence.

The average workweek stood at 34.4 hours, unchanged for the fourth consecutive week. The manufacturing workweek edged down by .1 of an hour to 40.5, with overtime unchanged at 3.2 hours. Changes in the workweek and overtime are considered indicators of economic growth. With increasing demand, employers first increase the workweek before adding new hires.

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • http://www.CollegeRecruiter.com/weblog Steven Rothberg

    This is great news for everyone except for those who for political reasons want to see fewer people employed. Those people will likely see their wishes come true in a month as employers in areas devastated by Hurricane Sandy can be expected to layoff some employees.

  • Keith Halperin

    Time again for this:

    Economic Forecasts last updated: 10/26/2012
    myweb.rollins.edu/wseyfried/forecast.htm

    Wells Fargo Securities Economic Forecast (latest monthly forecast, Oct 2012; latest forecast, Oct 26-latest weekly analysis): economic growth = 1.3% in 2012Q4, 0.7% in 2013Q1 and 1.4% in 2013Q2; 2.1% in 2012, 1.3% in 2013, and 1.9% in 2014; PCE inflation = 1.7% in 2012, 1.4% in 2013, 1.9% in 2014; core CPI inflation = 2.1% in 2012, 1.7% in 2013, 2% in 2014; unemployment rate declines to 7.6% by end of 2012 before rising to 8.1% by the third quarter of 2013, finishing 2013 at 8% and declining to 7.5% by the end of 2014

    Quarterly economic survey (USA Today – Oct 24, 2012): economic growth = 1.9% in 2012Q4 and 2012Q1, 2.4% in 2013Q2; 2.3% in 2013; unemployment rate = 7.9% by end of 2012, 7.6% in 2013Q4, inflation = 2% in 2012 and 2013

    Economic forecasting survey, Oct 2012 (WSJ): economic growth = 1.7% in 2012Q3. 1.8% in 2012Q4, 1.9% in 2013Q1; 1.7% in 2012, 2.3% in 2013, 2.9% in 2014; unemployment = 7.9% at end of 2012, 7.6% at end of 2013, 7.1% at end of 2014; inflation = 2% in 2012, 2.1% in 2013 and 2.4% in 2014; expect interest rate hike by end of 2014; 22% chance of recession in US in the next year, 67% cite downside risk to growth forecast

    IMF (Oct-see table 2.2): US economic growth = 2.2% in 2012, 2.1% in 2013; inflation = 2% in 2012, 1.8% in 2013; unemployment averages 8.2% in 2012, 8.1% in 2013; downside risks in the short run from Europe, fiscal cliff; downside risk in the medium term from a rising risk premium if global investors get concerned about US debt issues

    Univ. of Michigan Economic Forecast (executive summary – September 19, 2012): economic growth = 1.8% in 2012, 2.4% in 2013 and 2.9% in 2014; inflation (CPI) = 1.9% in 2013 and 2.1% in 2014 (core inflation = 1.9% in 2013 and 2014); unemployment rate equals 8.2% by end of 2013 and 7.8% by end of 2014

    Fed Forecast as of September 2012: economic growth = 1.7-2% in 2012, 2.5%-3% in 2013, 3-3.8% in 2014 and 2015; long-run economic growth = 2.3-2.5% (note: these are from 4th quarter to 4th quarter); unemployment rate = 8-8.2% in 2012, 7.6-7.9% in 2013, 6.7-7.3% in 2014, 6-6.8% in 2015 (estimates are for 4th quarter of the respective year); natural rate of unemployment = 5.2 to 6%; inflation as measured by PCE index of 1.7 to 1.8% in 2012 (core = 1.7-1.9%), 1.6-2% in 2013 (core = 1.7-2%), and 1.6 to 2% (core = 1.8-2%) in 2014, 1.8-2% (core = 1.9-2%) in 2015

    CBO (August 22, blog post): economic growth = 2.25% in second half of 2012, 1.7% in 2013 according to the alternative scenario (-0.5% according to the baseline including -2.9% in 2013H1; baseline assumes the expiration of tax cuts & implementation of spending cuts); unemployment rate = 8% at end of 2013 according to the alternative scenario, 9.1% under the baseline; PCE inflation = 1.4% in 2012; growth in potential GDP = 1.6% for 2013, 2.2% for 2014-2017, 2.4% for 2018-2022

    Survey of Professional Forecasters (latest survey Aug 2012): economic growth=1.6% in 2012Q3, 2.2% in 2012Q4; 2.2% in 2012, 2.1% in 2013, 2.7% in 2014, 3.1% in 2015; core inflation (PCE)=1.9% in 2012, 2% in 2013 and 2% in 2014 (overall PCE inflation=1.7% in 2012, 2% in 2013, 2.2% in 2014); unemployment rate=8.1% in 2012Q4; average unemployment rate = 7.9% in 2013, 7.3% in 2014, 7% in 2015; natural rate of unemployment = 6%

    OMB (July 2012 – see pdf page9): economic growth = 2.3% in 2012, 2.7% in 2013 and 3.5% in 2014; unemployment (Q4) = 7.9% in 2012, 7.6% in 2013, 7.1% in 2014; inflation = 2.1% in 2012, 1.9% in 2013, 2% in 2014; natural rate of unemployment = 5.4%, growth in potential GDP = 2.5%; see pdf page 11 for comparison with other forecasts

    World Bank Global Economic Forecast (June 11, 2012): US economic growth = 2.1% in 2012, 2.4% in 2013;

    Livingston Survey (latest survey – June 7, 2012): economic growth = 2.2% in first half of 2012, 2.6% in second half of 2012 and 2.3% in first half of 2013; unemployment rate = 8.1% in June 2012, 8% in Dec 2012 and 7.8% in June 2013; inflation (CPI) = 2.3% for 2012 and 2% for 2013; long-term economic growth = 2.7%, inflation averages 2.5% over the next decade

    American Banker’s Association (June 8): economic growth = 2.2% in 2012, 2% in 2013; unemployment = 8% in second half of 2012, 7.8% in 2013

    OECD Economic Outlook (May 2012): economic growth in US = 2.4% in 2012, 2.6% in 2013; inflation = 2.3% in 2012, 1.9% in 2013; unemployment rate = 8.1% in 2012, 7.6% in 2013

  • http://thesmokingrecruiter.wordpress.com Bill Barnes

    Do they track how many of the jobs are temporary assignments? I would think that would be an important number…

  • http://www.imomentous.com Sylvester Pascal

    Thats great news for Job seekers but are the recruiters ready to hire the best out there? Given the ratio of job seekers and recruiters, I am sure the hiring process will be very cumbersome. Also a lot of time will get wasted in the background checks. In such a case the recruiters should think out of the box and move to a technology that will help them recruit the most efficient without breaking a sweat. The solution to their problem is mobile. Why waste time by searching for a candidate and their background when their entire job history & qualification is right in front of you in no time. Learn more.

    http://www.imomentous.com/career-connect/

    http://blog.imomentous.com/