WASHINGTON (AP) — America’s employers accelerated their hiring last month, adding a solid 531,000 jobs, the most since July and a sign that the recovery from the pandemic recession is overcoming a virus-induced slowdown.
Friday’s report from the Labor Department also showed that the unemployment rate fell to 4.6% last month from 4.8% in September. That is a comparatively low level though still well above the pre-pandemic jobless rate of 3.5%. And the job gains in August and September weren’t as weak as initially reported: The government increased its estimate of hiring for those two months by a hefty combined 235,000 jobs.
All told, the figures point to an economy that is steadily recovering from the pandemic recession, with healthy consumer spending prompting companies in nearly every industry to add workers. Though the effects of COVID-19 are still causing severe supply shortages, heightening inflation and keeping many people out of the workforce, employers are finding gradually more success in filling near record-high job postings.
“This is the kind of recovery we can get when we are not sidelined by a surge in COVID cases,” said Nick Bunker, director of economic research at the employment website Indeed. “The speed of employment gains has faltered at times this year, but the underlying momentum of the U.S. labor market is quite clear.”
The better-than-expected jobs report was welcomed on Wall Street, where investors sent stocks further into record territory. The Dow Jones Industrial Average was up nearly 200 points, or roughly 0.5%, in early-afternoon trading. Short-term Treasury yields rose as some investors moved up their expectations for when the Federal Reserve will begin raising interest rates. But longer-term yields dipped amid muted expectations for inflation over the long term.
By most barometers, the economic recovery appears solidly on track. Services companies in such areas as retail, banking and warehousing have reported a sharp jump in sales. Sales of new and existing homes surged last month. And consumer confidence rose in October after three straight declines.
At the same time, though, the nation remains 4.2 million jobs short of the number it had before the pandemic flattened the economy in March 2020. The effects of the virus are still discouraging some people from traveling, shopping, eating out and attending entertainment venues.
In October, the pickup in hiring was spread across nearly every major industry, with only government employers reporting a job loss, mostly in education. Shipping and warehousing companies added 54,000 jobs. The battered leisure and hospitality sector, which includes, restaurants, bars, hotels and entertainment venues, gained 164,000. Manufacturers, despite their struggles with supply shortages, added 60,000, the most since June 2020.
And employers, who have been competing to fill jobs from a diminished pool of applicants, raised wages at a solid clip: Average hourly pay jumped 4.9% in October compared with a year earlier, up from 4.6% the previous month. Even a gain that strong, though, is barely keeping pace with recent surges in consumer inflation.
Those price increases pose a headwind for the economy. Higher costs for food, heating oil, rents and furniture have burdened millions of families. Prices rose 4.4% in September compared with 12 months earlier, the sharpest such jump in three decades.
Among people who are receiving pay raises, some of the biggest beneficiaries are the record-high number of people who have been quitting jobs to take new ones. One of them is Christian Frink, who has begun work as a business analyst at a digital consulting firm. In his new job, Frink, 27, of Ferndale, Michigan, helps business clients determine the technologies they need.
Earlier this year, Frink held a marketing job but left it because, like many people during COVID, he felt burnt out. He then worked for Door Dash during the spring and summer to earn money and searched for new work. Although employers were complaining about a labor shortage, several told him they wouldn’t hire anyone without a college degree. (Frink attended college but didn’t graduate.)
This past summer, Frink took coding classes at Tech Elevator, a boot camp, and then landed his new position. Now, he’s earning 35% more than in his previous job and says he’s “blown away” that he already has health care coverage and doesn’t have to wait months to become eligible.
Yet it isn’t only job-switchers who are receiving pay raises. Chad Leibundguth, a regional director in Tampa for the Robert Half staffing agency, said the job market is the strongest for workers he has seen in his 22-year career. Before the pandemic, he said, you could fill a customer service job in Florida for $14 an hour.
“Nowadays,” he said, “you’ve got to be closer to $20 an hour, because people have options.”
