"Something to Savor": U.S. Economy Adds 151K Jobs in October
Posted Nov 05, 2010 10:10am EDT by Aaron Task
Friday's jobs report adds a significant link to the recent chain of better-than-expected economic reports. The U.S. economy added 151,000 jobs in October, well ahead of expectations, the BLS reports. The unemployment rate held steady at 9.6%, as expected.
Stocks rose in the initial reaction to the news, with futures rising about 40 Dow points in pre-market trading. After a brief lift at the open, major averages dipped into the red as the dollar gained on the heels of the stronger-than-expected jobs data.
Other highlights from the report:
* -- Private payrolls rose by 159,00, far ahead of expectations and the tenth-consecutive monthly gain.
* -- Upward revisions to September and August netted 110,000 fewer job losses than previously reported.
* -- Average hours worked and average hourly earnings both rose.
* -- U-6, the "real" unemployment rate, fell to 17% from 17.1% in September.
"The report is better than expected and a most welcome development, corroborating our general thesis: the recovery is ongoing while the data continue to suggest that worries about a double dip recession are overblown," writes Dan Greenhaus, chief economic strategist at Miller Tabak. "The October employment report, in the context of the current recovery, was terrific."
The key phrase there being "in the context of the current recovery" as Greenhaus was quick to note 151,000 jobs is "hardly satisfactory" and much lower than the pace at similar points in past economic recoveries. "In the summer of '84, the economy was creating over 300K jobs per month," he writes. "Late in 1976 and early in 1977 (recession ended in spring 1975), the economy was creating 200K+ jobs per month."
With 14.8 million Americans still out of work, and around 42% for six months or longer, there's still a long, long way to go before "victory" can be declared in the war on joblessness. But the October report is "something to savor for the moment," as Greenhaus writes.
While certainly savoring the report, no doubt some folks in the White House are lamenting this report didn't come out a week earlier. In the accompanying video, Henry and I discuss the numbers and wonder whether the outcomes of Tuesday's Midterm election or Wednesday's Fed meeting would have been any different had this report come out a week ago vs. today.