Job growth decelerated significantly in October, driven by the effects of strikes and hurricanes. As stated in this month’s job report, October data are “the first collected since Hurricanes Helene and Milton struck the United States”. Despite lower monthly job gains, the unemployment rate held steady at 4.1%, indicating the labor market remains solid.

In October, wage growth remained unchanged. Wages grew at a 4.0% year-over-year (YOY) growth rate, down 0.3 percentage points from a year ago. Wage growth is outpacing inflation, which typically occurs as productivity increases.

National Employment

According to the Employment Situation Summary reported by the Bureau of Labor Statistics (BLS), total nonfarm payroll employment rose by 12,000 in October, down sharply from a downwardly revised increase of 223,000 jobs in September, marking the smallest monthly job gain in years. The estimates for the previous two months were revised lower. The monthly change in total nonfarm payroll employment for August was revised down by 81,000, from +159,000 to +78,000, while the change for September was revised down by 31,000 from +254,000 to +223,000. Combined, the revisions were 112,000 lower than previously reported.

In the first ten months of 2024, 1,701,000 jobs were created. Additionally, monthly employment growth averaged 170,000 per month, compared to the 251,000 monthly average gain for 2023. The Fed’s easing cycle began on September 18, marking the end of a period of restrictive monetary policy. The U.S. economy has created about 8 million jobs since March 2022, when the Fed enacted the first interest rate hike of this cycle.

The unemployment rate was unchanged at 4.1% in October. While the number of employed persons decreased by 368,000, the number of unemployed persons rose by 150,000.

Meanwhile, the labor force participation rate—the proportion of the population either looking for a job or already holding a job—decreased by one percentage point to 62.6%. However, for people aged between 25 and 54, the participation rate declined for the third straight month to 83.5%. This rate still exceeds the pre-pandemic level of 83.1%. Meanwhile, the overall labor force participation rate remains below its pre-pandemic levels of 63.3% at the beginning of 2020.

In October, employment continued to trend up in health care (+52,000) and government (+40,000). Temporary help for business and professional services lost 49,000 jobs. Manufacturing employment fell by 46,000 in October. The BLS noted that a decline of 44,000 in transportation equipment manufacturing was “largely due to strike activity.”

Construction Employment

Employment in the overall construction sector increased by 8,000 in October, after 27,000 gains in September. While residential construction shed 5,300 jobs, non-residential construction employment added 13,500 jobs for the month.

Residential construction employment now stands at 3.4 million in October, broken down as 957,000 builders and 2.4 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction was 3,000 a month. Over the last 12 months, home builders and remodelers added 44,500 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 1,388,200 positions.

In October, the unemployment rate for construction workers rose to 5.3% on a seasonally adjusted basis. The unemployment rate for construction workers has remained at a relatively lower level, after reaching 15.3% in April 2020 due to the housing demand impact of the COVID-19 pandemic.