This story has been updated.
The U.S. economy added 261,000 jobs in October as the country rebounded from hurricanes Harvey and Irma as expected, and the jobless rate ticked down to 4.1 percent — the lowest level since 2000.
The pace of hiring in October showed that the economy was recovering from the storms, Friday's report from the Bureau of Labor Statistics found. But year-over-year wage growth sank to 2.4 percent.
“It was a bounce back after the weak jobs figures from the hurricanes — the same pattern we saw with Hurricane Katrina in 2005,” said Andrew Chamberlain, chief economist at Glassdoor.
Analysts had anticipated October’s numbers would reflect economic recovery as employees in Texas, Florida and other states hit by the storms returned to work. Roughly 100,000 hospitality employees missed paychecks in September.
“Quite a bit of the loss we saw last month was not actually people who permanently lost their jobs, but rather people who did not happen to be paid during that period,” said Cathy Barrera, chief economist at the jobs website ZipRecruiter.
The initial September report showed the economy losing jobs for the first time since 2010, but the government revised the figure Friday to show the chaotic month brought a modest gain of 18,000 positions. The hurricanes, which put parts of Florida and Texas under evacuation orders, triggered this temporary slowdown. Wind and rain shuttered offices, destroyed homes, totaled cars and flooded roads.
Puerto Rico statistics do not appear in the monthly report.
Average hourly earnings for workers fell by one cent to $26.53 in October after rising 12 cents in the previous month. September’s pay figure, though, was skewed by the storms driving low-wage workers, primarily those in the hospitality industry, out of the labor market. (Workers at the bottom of the earning spectrum are the least likely to receive any paid days off, even if a natural disaster closes their workplace.)
U.S. Secretary of Labor Alexander Acosta said in a statement Friday that American workers need a bigger raise and expressed support for the GOP's plan to lower taxes for businesses and families.
“Our economy is moving in the right direction, but there is more work to do,” Acosta said. “Lower taxes and a simplified tax code will create the right conditions for increased labor force participation and increased wages.”
Several economists predicted a return to more typical pace of job growth in October.
“The streak is back,” said Jed Kolko, chief economist at Indeed, in a statement. “With the upward revision of September payrolls into positive territory, October's job gain of 261,000 is the 85th straight month of growth.”
Employment at fast food chains, restaurants and bars spiked by 89,000 in October after September’s steep drop of 98,000. Professional and business positions climbed by 50,000 for the month, which kept in line with average monthly increases over the last year, and manufacturing jobs surged by 24,000, driven by hiring in the computer and electronic fields as well as chemical plants.
Health care, which continues to be one of the fastest growing employment sectors, rose by 22,000 jobs.
Although demand for construction workers has surged in Texas and Florida, the government did not record extra job growth in that industry, largely because of labor shortages.
“There aren’t enough workers to do those jobs,” Barrera said. “You don’t see those extra jobs being created.”
The rising demand for workers, which cuts across industries, particularly benefited one type of employee in October: Those who worked in part-time roles but sought full-time jobs.
Over the past year, the number of what economists call “involuntary” part-timers has dropped by 1.1 million, with October bringing a 369,000 decline.
Robert Frick, corporate economist at the Navy Federal Credit Union, said the fundamentals of the job market last month remained stable.
“Manufacturing is strong,” Frick said. ‘Exporting is picking up. Consumer spending has been maintaining a good level” — all signs the economy is in good shape.
Mark Hamrick, senior economic analyst at Bankrate, a consumer financial services company in New York, agreed the country appears to be “humming right along,” but cautioned that the economic expansion continues to be uneven.
Some stretches of the Rust Belt are still reeling from the last two decades’ decline in manufacturing work, he said, and many workers in the heartland continue to lack the “soft skills”required to land a good-paying position. Some were also caught in the opioid epidemic.
“Larger cities on either coasts are the magnets for employment,” Hamrick said, “and a lot of places in between are continuing to suffer.”
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