‘Are We Landing Softly???’: Economists React To The October Jobs Report On Twitter
Nonfarm payroll employment rose by 261,000 jobs in October, the U.S. Bureau of Labor Statistics reported Friday.
The unemployment rate ticked up 0.2 percentage points to 3.7% in October and has remained between 3.5% and 3.7% since the end of the first quarter.
Monthly job growth has now averaged 407,000 jobs added per month in 2022, down from average growth of 562,000 jobs per month in 2021.
Most sectors directly related to commercial real estate saw very little change in the October numbers, save for the leisure and hospitality sector, which added 35,000 jobs.
Employment in leisure and hospitality is now averaging growth of 78,000 jobs per month this year, less than half of the average gain of 196,000 jobs per month in 2021. Employment in the sector is still short 1.1 million jobs compared to February 2020.
Here's how economists and others reacted to the October jobs report on Twitter:
Non-farm payrolls grew by +261k in October, yet another month of stellar job growth.
— Justin Wolfers (@JustinWolfers) November 4, 2022
Past two months show revisions of +52k for September and -23k for August, so this is an even stronger report.
Unemployment rate rose a tick to 3.7%.
This is a very strong economy.
Strong jobs report..lots of hiring, broad based, and wage growth is slowing slight. The Fed just might get us that soft landing
— Betsey Stevenson (@BetseyStevenson) November 4, 2022
This is not nothing for employment growth, but still number of jobs added is a tiny bit below expectations plus unemployment up and prime-age EPOP edging down does not look like a red hot labor market to me.
— Kate Bahn (@LipstickEcon) November 4, 2022
Are we landing softly??? https://t.co/l1KAPyn5A7
Hiring still looks strong in many sectors, but not all
— Heather Long (@byHeatherLong) November 4, 2022
Healthcare +53,000
Professional services +43,000
Manufacturing +32,000
Hotels +20,000
Social services +19,000
K-12 education +13,500
Trucking +13,200
Retail +7,200
Restaurants +6,000
Construction +100
Warehousing -20,000
Warehousing and storage down 20k jobs in October. We might be seeing some labor market fallout from the shift in consumption away from goods
— Nick Bunker (@nick_bunker) November 4, 2022
Another strong month for #manufacturing job growth in October. 32k. And according to JOLTS 800k+ openings as of September. This is the sector of the economy that can continue to drive innovation, productivity, and good jobs.
— Scott Paul (@ScottPaulAAM) November 4, 2022
Shifting to construction jobs. Residential building construction employment increased by a modest 0.3% MoM while nonresidential picked up by 0.4%. Residential building is up 7.7% compared to pre-pandemic, while nonresidential building remains 4.8% below. (9/n) pic.twitter.com/2bfF82zJNW
— Odeta Kushi (@odetakushi) November 4, 2022
For Fed watchers, today's report is a tricky one. The labor market is clearly hot, and hotter than the Fed wants. But really, it cares about how hot the jobs market is only to the extent that it drives wages and prices higher. And wage growth appears to be slowing (a bit).
— Justin Wolfers (@JustinWolfers) November 4, 2022
#jobsday annual rate of wage growth over the last three months is just 3.9 percent. This rate is very close to what would be consistent with Fed's 2.0 inflation target.
— Dean Baker (@DeanBaker13) November 4, 2022
Thinking about the range of outcomes in the labor market over the next 6 months, it's somewhere between "concerning rise in weakness" and "gradual deceleration in strength" -- more room for interest rates to fall on that than rise.
— Conor Sen (@conorsen) November 4, 2022
The Fed has already done enough to ensure a big decline in inflation. They should pause rate increases, and need to be ready to cut rates. 5/
— Heidi Shierholz (@hshierholz) November 4, 2022
Equally, inflation is a real problem. But even the Fed's own projections suggest that the worst may be behind us, with PCE inflation expected to fall to two-point-something by the end of next year.
— Justin Wolfers (@JustinWolfers) November 4, 2022
"There is substantial disinflation in the pipeline that will allow inflation to normalize in coming months even if the labor market remains strong," writes @joshbivens_DC. Policymakers can't ignore the latest deceleration in wage growth for a soft landing. https://t.co/xBZjLnMaIp
— Elise Gould (@eliselgould) November 4, 2022
Strong but softening #jobsreport. Positive: +261 jobs. Tepid: 4.7 percent wage growth. Bad: #unemployment rate up for the wrong reasons, fewer working, fewer looking. UR ticked up among those with less education and Latino workers, as restaurant/hospitality hiring slowed
— Andrew Stettner (@pelhamprog) November 4, 2022
In sum,
— Aaron Sojourner (@aaronsojourner) November 4, 2022
- modest weakening of labor demand, taking pressure off but without wrecking anything yet,
- consistent with possible soft landing but not at all assured,
- lagging booster campaign adds risk of winter COVID wave causing disruption & health harms.
