Lackluster job market sparks to life
Saturday, November 6, 2010
The moribund job market finally showed signs of improvement in October, the government said Friday, offering hope that the economy may finally be accelerating after six months of weak growth.
Employers added 151,000 jobs in October, the Labor Department said, the strongest job growth since May and more than double what analysts had expected. Earlier months' results were also revised to indicate milder job losses. The unemployment rate was unchanged at 9.6 percent.
There was also positive news for workers' pay, as both the length of the average workweek and average hourly wages rose, creating an 0.6 percent rise in weekly income.
The report was an encouraging sign after six months of economic growth at less than a 2 percent annual rate, too slow to improve the job market. The economy, while hardly roaring ahead, appears to have picked up a bit heading into year's end. Other economic data, such as surveys of business activity, also show modest acceleration in October.
"There is little ambiguity in this report," said Bernard Baumohl, chief global economist of the Economic Outlook Group. "Labor market conditions are clearly getting better, though still not fast enough to bring down the stubbornly high unemployment rate."
It takes about 125,000 new jobs a month to keep pace with an population growth, meaning that even if the October rate was sustained the jobless rate would come down only glacially.
The job gains were concentrated in the private sector, especially in service industries. Temporary help firms added 35,000 positions, health-care employers added 24,000, and the retail sector added 28,000 jobs.
President Obama hailed the October numbers, but also noted that they mean little to the nearly one in 10 Americans searching for employment and coming up empty-handed.
"The fact is, an encouraging jobs report doesn't make a difference if you're still one of the millions of people who are looking for work," Obama said, departing on a four-nation Asia trip. He said he intends to try to "pry open markets" and look for ways to strengthen the economy at home.
"We've got to keep fighting for every job, for every small business, for every opportunity to get this economy moving," Obama said. "I am open to any idea, any proposal."
The new reading on the nation's job market comes two days after the Federal Reserve launched another effort to pump $600 billion into the economy, an action specifically aimed at trying to break the nation out of its high-unemployment rut.
The stable overall jobless rate masked some shifts within the workforce: 254,000 people dropped out of the labor force, and the number of people reporting themselves as looking for work fell as well. That bodes ill for the future because as the economy continues to improve, many of those who have exited the labor force are likely to reenter it, which could put upward pressure on the unemployment rate over the coming year.
The government sector was a drain on employment, shedding 8,000 positions in October. Those losses were highest among state and local governments, which shed 14,000 jobs, excluding education, suggesting budget woes continue to lead governments to cut back on civil servants.
A broader measure of unemployment, which includes people who are working part time but want a full-time job and people who have given up looking for work out of frustration, edged down to 17 percent, from 17.1 percent.