Employers across the United States hired more than half a million workers in October as recruitment within the world’s largest economy accelerated after months of disappointing growth.
America’s recovery regained momentum, with 531,000 jobs added to a workforce hit this summer by Covid-19 outbreaks and labour shortages.
Unemployment fell to 4.6 per cent from 4.8 per cent, according to data released by the US Bureau of Labor Statistics that exceeded expectations on Wall Street. Economists had forecast a 450,000 increase in jobs.
The figures were warmly welcomed on Wall Street last night, with all New York’s leading stock indices closing at record highs — both the S&P 500 and Nasdaq doing so for a seventh consecutive session.
The S&P ended the day on 4,697.53, up 17.47 points, or 0.4 per cent, taking it up 2 per cent for the week and making a fifth consecutive weekly gain. The Nasdaq added 31.28 points, 0.2 per cent, to 15,971.59 and the Dow Jones industrial average rose 203.72 points, or 0.6 per cent, to 36,327.95.
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The jobs numbers came two days after policymakers at the US Federal Reserve approved plans for the central bank to start paring back its vast pandemic support, saying that indicators of economic activity and employment had continued to strengthen.
Restaurants and bars led the rebound in October as pandemic restrictions eased and people spent more time outside their homes, although employment across the leisure and hospitality industries remained 1.4 million shy of its pre-pandemic level.
The sharp rise in job creation is a significant boost for the US labour market. Its recovery stuttered for months after the rapid spread of the Delta variant triggered a fresh surge in cases and prompted businesses to batten down the hatches. The American workforce is 4.2 million short of where it was in February last year, before Covid-19 first swept through the country, but it has come a long way since the height of the outbreak last spring, adding 18.2 million jobs.
The official monthly non-farm payrolls release is widely regarded as the most important indicator of how the economy is performing. It shows how many staff were hired or fired by private employers other than farms, which are excluded from the figures because of seasonal variations.
Previous readings were also revised higher. Jobs growth in August, already upgraded from 235,000 to 366,000, is now thought to have hit 483,000. September was updated from 194,000 to 312,000.
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Gregory Daco, at Oxford Economics, the consultancy, said that “improving health conditions and gradually rebounding labour supply” had bolstered job creation in October and he forecast a “cruising speed” of between 400,000 and 600,000 monthly gains as the year draws to a close. “The clouds hanging over the labour market are dissipating,” he said.
Fed officials agreed on Wednesday to begin tapering its $120 billion monthly bond-buying programme. However, Jerome Powell, the Fed chairman, emphasised that there was “ground to cover” before it could consider raising interest rates, which are close to zero.
