U.S. Employers Added 638,000 Jobs in October

U.S. employers added 638,000 jobs in October, beating the forecast of 530,000 and signaling a resumption of economic activity in the country.

The unemployment rate fell to 6.9%, down one percentage point from September’s reading of 7.9%, while the number of unemployed people fell by 1.5 million to 11.1 million, the U.S. Bureau of Labor Statistics reported. While both measures declined for the sixth consecutive month since the spring, they are still nearly twice as high as their February levels before COVID-19 hit the U.S.

Gains By Sector

In October, notable job gains occurred in leisure and hospitality, professional and business services, retail trade, and construction. Meanwhile, employment in utilities, information, and government declined.

The number of people on temporary layoff fell by 1.4 million to 3.2 million in October, considerably lower than the high of 18.1 million in April but still 2.4 million higher than in February. Meanwhile, the number of people who permanently lost their jobs in October was also 2.4 million higher than in February, though it decreased slightly to 3.7 million from September’s 3.8 million.

Unemployment by Race and Gender

The recovery in the labor market continues to be uneven by race, with Black and Hispanic unemployment still significantly higher than for White and Asian workers. Nonetheless, the unemployment rate declined among all major working groups in October.

The unemployment rates for adult men and women were nearly equal at 6.7% and 6.5%, respectively.

Uptick in Long-Term Unemployment

Despite the continued increase in the rehiring of workers that were temporarily laid off, those out of work for 27 weeks or more continued to increase. There are 3.6 million unemployed workers classified as long-term unemployed, accounting for 32.5% of the total unemployed. 

In October, 15.1 million people reported that they had been unable to work because their employer closed or lost business amid the pandemic, down from 19.4 million in September.

Big Picture

The report comes as U.S. election uncertainty looms. Both President Donald Trump and former Vice President Joe Biden have promised to add jobs if they win the Oval Office. 

Meanwhile, voters in Florida approved a measure to gradually raise the minimum wage to $15 per hour. It will be the eighth state in the country to do so. The current minimum wage in the state is $8.56 and Amendment 2 is expected to lift pay for about 2.5 million workers.