The Bureau of Labor Statistics’ latest jobs report suggests a slowing labor market, which doesn’t bode well for the holiday shopping season.
The U.S. added 150,000 jobs last month, a shortfall compared to economists’ prediction of a 170,000 increase in total employment.
As reports point out, that number of jobs added hasn’t been that low since January 2021. What’s more, lack of big orders from retailers belie concerns that consumer spending will be weak, per a new CNBC report.
It’s a “historically unusual and very welcome result” that there’s been “significant progress on inflation without seeing the kind of increase in unemployment that has been very typical of rate-hiking cycles like this one,” Fed chairman Jerome Powell said at a Wednesday press conference.
Powell noted that although the inflation rate shrank a bit, so did the number of jobs, a problem since the cost of goods and services has still steadily increased at a faster pace than wages did.
“This is a very Fed-friendly report,” Sal Guatieri, a senior economist at BMO Capital Markets in Toronto told Reuters. “The only wrinkle is that the labor force shrank. Still, the overall softness in the report will go a long way to keeping the Fed on the sidelines for a third straight meeting in December.”
More than 50% of private sector industries said there’d been an increase in employment, the lowest since spring 2020.
“October’s employment report, in conjunction with the third-quarter report on productivity and costs, clearly indicates that the economy has converged already to potentially a more sustainable path of low inflation and solid potential growth,” said Brian Bethune, an economics professor at Boston College.