Hurricanes, labor strike wreak havoc on jobs figures
US job growth hit its slowest pace last month for nearly four years, with nonfarm payrolls increasing by just 12,000 thanks in large part to the impact of hurricanes and labor disputes.
Bureau of Labor Statistics figures released Friday showed the smallest jobs gain recorded since December 2020, significantly lower than the Dow Jones estimate for 100,000 new jobs and a big month-over-month decrease.
A strike by Boeing employees culled 44,000 manufacturing jobs last month, the Bureau said, accounting for all but 2,000 of the job losses in that sector. Hurricanes Helene and Milton, which wreaked havoc in the Southeast, also likely had a negative impact even though the Bureau said the net effect of those storms on the labor market were “not possible to quantify.”
Despite the middling jobs figures, the unemployment rate held steady at 4.1%, while average hourly earnings posted a larger-than-expected increase for the month (0.4%).
Downward revisions were also registered for prior months, with August’s numbers now estimated at a 78,000 gain and September job growth lowered to 223,000.
Mortgage Bankers Association (MBA) senior vice president and chief economist Mike Fratantoni said a 368,000 decrease in employment seen in the latest figures showed a continuing theme of an ongoing reduction in job openings rather than large layoffs.
The association anticipates the pace of economic growth to slow this quarter and through 2025, “and expects that the Federal Reserve will respond by continuing to cut rates at a steady pace over the next year,” Fratantoni said.
“Longer-term rates, including mortgage rates, have largely priced in this expected path by the Fed, but today’s news is likely to bring mortgage rates somewhat lower as it adds more evidence that the economy is on a path to slower growth.”
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