WASHINGTON—Last week’s jobs report – with 250,000 jobs gained in October – revealed above-average expectations with growth in major industries, which is good news for those seeking work but less of a blessing for those with variable-rate loans, according to one analysis.
NAFCU Chief Economist and Vice President of Research Curt Long noted that the positive economic growth will likely lead to another rate hike when the Fed meets next month.
"The labor market topped expectations during October, with above-trend job growth, a healthy increase in the labor force, and the fastest pace of annual wage growth in nine years," said Long. "The data will reassure the Fed that the strength of the job market – which has been the main source of economic growth throughout the recovery – remains intact. Another rate hike is coming next month, and two additional quarter-point increases are likely in the first half of 2019."
The unemployment rate remained at 3.7% in October as the labor force expended 711,000 workers.
In other report data, private-sector payroll employment increased 246,000 jobs during October. The goods-producing sector increased 67,000 jobs, while the service sector increased 179,000 jobs. Public sector employment rose 4,000 from the prior month, stated Long.
Average hourly earnings increased five cents to $27.30 in October. Over the last 12 months, wages are up 3.1%, which represents the largest gain since April 2009. Since 2009, year-over-year wage growth has averaged just 2.3%, Long noted.