The October unemployment rate dipped to its lowest level in 7-1/2 years, while net job growth far exceeded analysts’ expectations.
According to the most recent monthly report from the Bureau of Labor Statistics (BLS), the private sector netted 268,000 nonfarm job gains in October. Local, state and federal governments netted 3,000 job gains, resulting in 271,000 total net job gains. Analysts had expected only around 180,000-185,000 total net job gains, according to various sources.
The unemployment rate dipped to 5.0 percent in October. That’s the lowest rate since April of 2008 when it was 5.0 percent, but beginning to rapidly rise toward the recessionary high of 10.0 set in October 2009.
The private sector has now gained nonfarm jobs for 68 consecutive months since the Great Recession. The unemployment rate has dropped 5.0 percentage points from the recessionary high.
The BLS also revised job gains for August and September, showing that the economy netted 12,000 more jobs than the BLS had previously estimated for the two months. Net job gains have averaged 187,000 per month in the past three months.
Starbucks, Walmart, Macy’s, JPMorgan Chase, Hilton, Microsoft, Walgreens and a variety of other major U.S. companies have formed the “100,000 Opportunities Initiative”. By 2018, the companies intend to train and hire 100,000 teenagers and young adults (from 16 to 24 years old) who face obstacles to employment and educational opportunities. The first “Opportunity Fair and Forum” held on August 13, 2015 in Chicago, IL was a huge success. Visit the Website linked above for more information.
Job growth continued in the professional and business services industry at 78,000, more than twice as many jobs as last month. Temporary help services (“temp workers”) gained 24,500 of those, more than five times as many as last month. Across the entire industry, net job growth has averaged 52,000 per month in the past year.
At 45,000, job growth also continued in health care. Over the past year, the industry has added 495,000 jobs. Much of the industry’s steady job growth over the past few years, even throughout the Great Recession, is attributable to the increasing medical demands of aging baby boomers and the ever-growing obesity epidemic, and to provisions in the Affordable Care Act (“Obamacare”) as well.
The retail trade gained 44,000 jobs in October, many of which were likely due to the start of temporary holiday hiring. The industry netted an average of 25,000 jobs per month in the year prior to October.
The food services and drinking places industry gained 42,000 jobs. The same goes here: many were likely due to temporary hiring in preparation for the holiday season. The industry added 368,000 jobs in the year prior to October.
Manufacturing, an industry that economists consider to be a gauge of labor-market health, had net gain of zero jobs in October after losing 9,000 in September and 18,000 in August. Construction, also a measure of labor-market health, gained 31,000 jobs after not gaining very many in recent months. (See Table B by the BLS for more job numbers listed by industry.)
Among the major work groups tracked by the BLS, teenagers again suffered the highest unemployment rate (15.9 percent) followed by blacks (9.2), Hispanics (6.3), adult men (4.7), adult women (4.5), whites (4.4) and Asians (3.5, not seasonally adjusted). No group experienced much change in their unemployment rate except for teenagers, who saw a drop of 0.4 percentage points.
Workers who are 25 years of age or older and who have earned four-year college degrees or higher experienced a 2.5 percent unemployment rate in October, the same as in September. Those in the same age group and who don’t have high school diplomas suffered a much-higher 7.4 percent rate, down from 7.9 percent in September. (See Table A-5 by the BLS for more information about the unemployment rate by education level.)
The unemployment rate, now at 5.0 percent, has dropped by 0.7 percentage points in the past year. Economists consider an unemployment rate of 5.0-5.5 percent to be normal and a sign of a healthy economy.
The number of workers that the BLS counted as unemployed in October was 7.9 million, the same as in September. The number of unemployed workers has decreased by 1.1 million in the past year.
The count of unemployed workers does not include those who are involuntarily working only part time and with fewer benefits, if any, such as no health insurance, because they can’t find full-time jobs or employers cut their work hours. The number of involuntarily part-timers in October was 5.8 million, down from 6.0 million in September. The number of workers who are involuntarily working only part time has declined by 1.2 million in the past year.
The average workweek for all part-timers and full-timers in the private sector in October remained at 34.5 hours from September. Their average hourly earnings rose by 9 cents to $25.20. Average hourly earnings have risen by 2.5 percent in a year. Average hourly earnings increased by 9 cents to $21.18 in October, for private-sector production and nonsupervisory employees.
The unemployment rate also does not include “marginally-attached” unemployed workers. The BLS does not count them in the official rate because they stopped looking for work in the four weeks preceding the count, for reasons such as school attendance, family matters or their collective perception that there simply are no jobs — at least not for them.
The number of marginally-attached workers in October was 1.9 million, the same as in September. Among the marginally-attached, 665,000 were so-called “discouraged workers” because they gave up looking for work due to their shared perception that there are no jobs. The number of discouraged workers was up by 30,000 from the 635,000 that the BLS initially reported for September. (The BLS does not seasonally adjust any of the figures in this paragraph.)
The number of long-term unemployed workers, those who have been without jobs for 27 weeks or longer, was 2.1 million in October, the same as in September. These workers accounted for 26.8 percent of the unemployed. Standard state unemployment benefits last only up to 26 weeks without extensions.
If you are a recent victim of job loss or a reduction in work hours resulting from the high unemployment rate, then you might be eligible to collect full or partial unemployment benefits from the state unemployment office. You might also be eligible to continue your employer-provided group health insurance coverage through COBRA.
For more details about the October 2015 unemployment rate and job numbers, see the “Employment Situation Summary” by the BLS. The BLS plans to report the November 2015 unemployment rate and job numbers on December 4. To receive notification like the above automatically, subscribe to Employee Rights Blog for free.
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Except where otherwise noted, figures in this unemployment rate report were rounded and/or seasonally adjusted by the BLS, and are subject to revision by same (based on additional data that was not initially available). The unemployment rate chart pictured above was provided by the BLS.