The monthly jobs report — the final piece of major economic data to land before a consequential, contentious and too-close-to-call election — was clear as mud.
The US economy added just 12,000* jobs in October, according to data released Friday by the Bureau of Labor Statistics. If the initial estimate were to hold firm, it would be the weakest monthly job gain since 243,000 jobs were lost in December 2020 when Covid and its variants reared their ugly head.
Friday’s tally is far below September’s revised total of 223,000 jobs added and expectations for a 112,500-job gain.
*And now to the asterisk: Friday’s net gain was a reflection of temporary shocks to the US labor market, with this snapshot bearing the impacts and ripple effects of two major deadly hurricanes and large labor strikes.
“Between storms, labor strikes and data collection issues, the labor market numbers we’re seeing today should be taken with a grain of salt,” Elizabeth Renter, senior economist at NerdWallet, wrote in commentary issued Friday. “Even though they came in lower than anticipated with that in mind, the news doesn’t warrant panic about overall economic health.”
Economists had warned that those events would heavily distort the data, making it much harder to interpret the true underlying health of the labor market.
On Friday, BLS said as much, noting a shorter data-gathering period was exacerbated by collection efforts in weather-affected regions.
However, amid the murkiness in the payroll data, the unemployment rate (which is generated by a different survey that doesn’t count weather-affected workers as unemployed) provided a signal of stability in the labor market: It held steady at 4.1%.
The dual hurricanes of Helene and Milton, which made landfall on September 26 and October 9, respectively, impacted the ability for the BLS to collect data from businesses in the affected regions, officials for the labor data agency wrote in a note accompanying the jobs report. Those challenges were exacerbated, by a shorter collection period: Typically, the BLS collects data over a range of up to 16 days; but in October, it was 10 days.
In the establishment survey — one of two surveys that feed into the monthly employment report — the reference period is the pay period that includes the 12th of the month. If an employee worked and received pay for any part of that period, they will be counted as employed.
“It is likely that payroll employment estimates in some industries were affected by the hurricanes; however, it is not possible to quantify the net effect on the over-the-month change in national employment, hours, or earnings estimates because the establishment survey is not designed to isolate effects from extreme weather events,” BLS officials wrote in the report.
There was no discernible effect in the household survey, which generates the unemployment rate, as the survey counts people who miss that week of work for weather-related events as employed (regardless of pay).
As such, even though the household survey is typically considered the more volatile of the two, how much or how little the unemployment rate shifts could provide a true indicator of how the underlying labor market is faring, economists told CNN this week.
This story is developing and will be updated.
The-CNN-Wire
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