The US employers have created 250,000 new jobs in October and have risen wages at the fastest pace since 2009 in an effort to attract and retain workers. The US Labor Monthly Employment Report, containing the latest important economic indicators before the midterm elections on November 6, still reports a 40-year minimum unemployment rate of 3.7%.
The consumers now have the highest confidence of 18 years and spend freely, boosting economic growth. The US economy has been expanding for 10 years – the second-largest period in the country’s history, and October is the hundredth consecutive month of new appointments – also a record-breaking period.
Recent data show an increasing tightening of the labor market, which encourages the Federal Reserve to raise interest rates again in December.
Moreover, a strong labor market could alleviate fears about the stability of the economy due to weaker housing data and a slowdown in business spending. By comparison, economists’ expectations were to add 190,000 new jobs to the economy in October.
The average hourly wages in the US rose by 0.05 USD or 0.2% last month after a 0.3% growth in September. O an annual basis, the increase reached 3.1% – the highest since April 2009. This means that inflation will stay around the Fed’s target of about 2% for some time.
It is not expected next week that the Fed will change its monetary policy, but strong labor market data in October backs the expectation of this happening in December.
The growth of employment with an average of 218,000 jobs for the month over the past three months is twice as high as the 100,000 jobs needed to meet the growing working-age population. This is good news for the US economy, which is expected to slow down significantly after the Donald Trump administration’s 1.5-trillion-dollar tax cuts impact.