Nonfarm payrolls increased 531,000 in October after large upward revisions to the previous two months, according to a Labor Department report released on Friday, Nov. 5. The unemployment rate fell to 4.6 percent in October, down from 4.8 percent in September, while labor-force participation remained unchanged.
According to the median estimate of economists polled by Bloomberg, payrolls will increase by 450,000 and the unemployment rate will fall to 4.7 percent. Following the release of the data, the dollar maintained its gains, while the yield on the 10-year Treasury note fluctuated.
The faster hiring rate indicates that more Americans returned to work as COVID-19 cases decreased and employers offered higher wages. Some of the payroll growth could also be attributed to the estimated 7.5 million people who lost federal extended unemployment benefits on September 6.
With October's increase, payrolls are now 4.2 million lower than they were before the pandemic. The hiring pace in the coming months may be slowed by new COVID flare-ups. Recent data show an increase in hospitalizations in 13 states, which could signal the start of another virus wave. Health-care payrolls increased by the most this year in October.
According to the Labor Department's report, the average workweek fell to 34.7 hours in October from 34.8 hours the previous month.
The stagnant labor force participation rate — the number of Americans who are either employed or looking for work — indicates difficulties in re-engaging people in the labor force. Since August of 2020, participation has remained near current levels, owing in part to increased retirements and parents leaving jobs to care for their children.
"There is still work to be done to achieve maximum employment, both in terms of employment and participation," Powell said on Wednesday, Nov. 3.