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The US added very few jobs in October after hurricanes and strikes shook the economy

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The US added very few jobs in October after hurricanes and strikes shook the economy

  • The US economy added just 12,000 jobs in October, way under the forecast of 106,000.
  • The unemployment rate remained at 4.1% as expected.
  • Labor market watchers expected cooler job growth than September’s, partly because of recent hurricanes and strikes.

The US economy added just 12,000 jobs in October, falling way short of the forecast of 106,000.

The unemployment rate in October matched expectations and held steady at 4.1%.

Economists and labor market watchers expected job growth to slow after the back-to-back natural disasters of Hurricane Helene and Hurricane Milton in late September and early October disrupted life in several states.

“October data from the household and establishment surveys are the first collected since Hurricanes Helene and Milton struck the United States,” a news release from the Bureau of Labor Statistics on Friday said. “These hurricanes caused severe damage in the southeast portion of the country.”

Data from the household survey, which BLS said wasn’t affected as much by the hurricanes, showed 512,000 workers in nonfarm industries missed work because of bad weather in October. That’s much higher than the October average of 63,000 over the previous 20 years.

Labor strife also probably weakened October’s job growth numbers. The Bureau of Labor Statistics said before Friday’s news release that around 44,000 hotel workers, Boeing workers, and others were on strike as data for the report was being gathered.

Those two factors weighing on the headline job creation numbers mean the Federal Reserve will likely take this month’s report with a grain of salt when deciding whether to pause or continue its interest rate cuts.

“The Federal Reserve will likely look through the noisy October jobs report and rely on the totality of labor market data which continues to point to a controlled downshift in job creation and labor supply absorption,” EY senior economist Lydia Boussour said ahead of the report.

Julia Pollak, chief economist at ZipRecruiter, told Business Insider she wasn’t surprised by the report because of the impact from the hurricanes and strikes.

“That said, it’s not just a blip,” Pollak said. “It is consistent with the ongoing labor market slowdown that we’ve seen over the past two years. This is a labor market that is growing, but slowing, and that growth is increasingly narrowly concentrated.”

The mixed results in the jobs report could complicate the Fed’s interest rate plans into next year. The report is just one of many pieces of data Fed members will rely on when making their decision next week. Shortly after the release Friday morning, traders overwhelmingly thought the Fed would cut interest rates by 25 basis points next week, which would be less than the previous 50-basis-point cut in September.

Cory Stahle, an economist at the Indeed Hiring Lab, told BI that “the labor market is still in a relatively solid position” and the stable unemployment rate is one bright spot in the latest report.

“A soft landing is something that is still on the table, but we’re not necessarily at a point where we achieved that yet,” Stahle said.

The new jobs report is the last US employment report before the presidential election on November 5. An October survey from AP-NORC found that 43% of registered voters “trust” Kamala Harris can do a better job handling jobs and unemployment, close to the 41% of registered voters that said Donald Trump.

This is a developing story. Please check back for updates.

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