Strong job numbers in the US: labor market defies expectations

The unemployment rate fell to 4.1 percent, an improvement compared to the expected 4.2 percent. Simultaneously, hourly wages increased by 0.4 percent compared to the previous month and by 3.1 percent compared to the previous year.

In the private sector, 159,000 jobs were created, while the public sector saw the creation of 6,000 new jobs. Industry recorded an increase of 19,000 jobs. The largest gains were in professional and business services (70,000), healthcare (42,000), and transportation and warehousing (25,000).

A negative signal is the increase in the broader unemployment rate U-6 to 7.9 percent, which indicates an increase in involuntary part-time employment and discouraged job seekers. The labor force participation rate rose slightly to 61.9 percent, while the average weekly working hours remained unchanged at 34.4 hours. The average hourly wage in the private sector increased by 14 cents to $38.

These data are particularly relevant for the US Federal Reserve’s (Fed) interest rate policy, which considers the labor market in addition to inflation. The Fed raised the key interest rate for the first time since July 2023 in September. Two of the twelve voting members already supported a further increase. The robust labor market data strengthens this position. Should consumer prices for October also be strong on Tuesday, November 10th, a rate hike on December 9th would become more likely.

US stock futures reacted differently to the news: The Dow Jones Future was 0.9 percent lower pre-market, the S&P-500 Future rose by 0.2 percent, and the Nasdaq-100 Future gained 1.5 percent. The yield on ten-year US Treasury bonds is 4.87 percent. The Euro costs $1.1150, gold $4,070 per fine ounce, and a barrel of Brent crude oil $98.80.