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Repeats Story Initially Transmitted at 12:30 GMT Nov 3/08:30 EST Nov 3
--Weaker Than Expected Payrolls Follow +90k Revision To Aug-Sept Jobs
--Unemployment Rate Lowest Since December 2000; Participation Rate Drops
--Hourly Earnings Flat After +0.5% in August, Y/Y Rate Now +2.4%
By Kevin Kastner, Sara Haire, and Holly Stokes
WASHINGTON (MNI) - The October employment report released Friday
showed nonfarm payrolls rose by a weaker-than-expected 261,000, but that
was on the heels of a net 90,000 upward revision to August-September
payrolls that suggest the hurricane impact was bad, but not as bad a
In addition, the unemployment rate slipped to 4.1%, the lowest
since December 2000 when it was 3.9%. While this was due to a shrinking
of the labor force and a drop in the participation rate, it is still
likely to raise heads in the markets and with the FOMC.
The labor force fell by 765,000, household employment was down
384,000, and the number of unemployed fell by 281,000. As a result, the
labor participation rate fell by 0.4pp to 62.7% after rising to 63.1% in
the previous month.
Within payrolls, food services and drinking places jobs rose by
86,000 after a 98,000 decline in September, the clearest evidence of the
impact of the hurricanes on the recent data.
There were notable payrolls gains posted for manufacturing (+24k),
construction (+11k), and professional and business services (+50k). In
contrast, retail payrolls fell by 8,000.
Average hourly earnings were flat in October, smaller than the 0.2%
gain expected, after a 0.5% September gain. The 2.4% year/year rate in
October was well below the 2.8% rate in September and even down from
2.6% in August.
The overall average workweek held steady at 34.4 hours for the
fourth straight month.
MNI's Reality Check survey of recruiters by Vicki Schmelzer
released Thursday showed that labor shortages and wage pressures
continued in October.
Also released Friday, the September trade deficit widened to $43.5,
exactly as expected. The BOP goods gap widened to $65.4 billion in
September, while the census goods gap widened to $64.1 billion, the same
as the advance estimate used to calculate advance third quarter GDP. As
a result, the impact on the next revision to GDP for the quarter should
** MNI Washington Bureau: 202-371-2121 **