Connect with us

Hi, what are you looking for?

Business

US hiring slows more than expected with auto strike drag

Job growth in the U.S. cooled in October, according to government data released, in part dragged down by an auto workers strike.

The US economy added 150,000 jobs in October, less than analysts expected, while the unemployment rate ticked up, said the Labor Department
The US economy. — © GETTY IMAGES NORTH AMERICA/AFP/File JOE RAEDLE
The US economy. — © GETTY IMAGES NORTH AMERICA/AFP/File JOE RAEDLE
Beiyi SEOW

Job growth in the United States cooled in October, according to government data released Friday, in part dragged down by an auto workers strike.

The world’s biggest economy added 150,000 jobs last month, less than analysts expected and down from a revised 297,000 figure in September, the Labor Department said.

The unemployment rate edged up to 3.9 percent, the report added.

This is likely seen as good news for policymakers, given concerns that a too-hot labor market could contribute to elevated inflation.

The job market has been unexpectedly resilient over the past year, even as the central bank lifted interest rates rapidly to combat inflation –- a move that typically sees hiring cool and unemployment edge up.

But robust job and wage growth has allowed consumers to continue spending even as inflation came down, buoying economic growth.

This has lifted hopes that the United States can avoid a recession despite higher interest rates.

Average hourly earnings in October rose 0.2 percent, inching down from the month before, Labor Department data showed.

– Strike impact –

“Employment in manufacturing decreased by 35,000 in October, reflecting a decline of 33,000 in motor vehicles and parts that was largely due to strike activity,” the Labor Department said.

Last month, auto workers expanded a strike launched in mid-September.

The United Auto Workers union had launched the first simultaneous work stoppage at the “Big Three” automakers – General Motors, Stellantis and Ford — pushing for higher wages and other improvements.

It expanded the labor action as negotiations wore on and at its height, the strike mobilized more than 45,000 workers before deals were reached with all three of the companies.

Kathy Bostjancic, chief economist at Nationwide, said the auto strike’s impact is temporary.

Outside of that, “we look for a resumed, broad-based slowing in job creation,” she told AFP.

Looking ahead, EY chief economist Gregory Daco told AFP: “Moderating wage growth, along with slower demand for goods and services, easing rent inflation and reduced pricing power should lead to further disinflation.”

This argues in favor of the Federal Reserve holding the benchmark lending rate steady in the coming months, he added.

“While Fed policymakers will maintain the optionality of further tightening, we continue to believe that the Fed’s tightening cycle is complete,” Daco said.

AFP
Written By

With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

You may also like:

Tech & Science

We were surprised to find that different gut microbes spread through social contacts and shared environments.

Business

OpenAI co-founder Ilya Sutskever and "superalignment" team co-leader Jan Leike announced their departures from the ChatGPT-maker this week.

Tech & Science

GenZ does not see home ownership as a priority, or even an attainable goal, as previous generations did.

World

A view of the site where the Shahmama Buddha statue once stood before being destroyed by the Taliban in 2001, in Bamiyan province on...