The U.S. economy added 171,000 jobs in October, according to the nonfarm payrolls report from the Bureau of Labor Statistics. That was well above the expected 125,000, and private sector payrolls were up 184,000. Unemployment was little changed, up a tenth of a point to 7.9%.
Job growth was widespread, with gains in every sector but government, and the previous two months were revised higher. September’s figure was increased to 148,000, from 114,000, while August’s jobs tally rose to 192,000 from 142,000.
The Labor Department said Hurricane Sandy had no discernible impact on its collection of employment data. The household-based survey was completed before the storm, while the establishment survey fell within normal ranges, even for the affected areas, the BLS said.
Friday’s number marks the last reading on the U.S. labor market before Americans go to the polls Tuesday, and the Obama and Romney campaigns will be quick to weave the figure into their candidate’s narrative.
Throughout the campaign the president has maintained that his administration has made progress since coming into office in January 2009, when the economy was still hemorrhaging hundreds of thousands of jobs per month. Mitt Romney has argued that Obama’s policies have failed to reignite the American economy and are holding back stronger job growth.
October’s jobs report is hardly a home run. Any job gain is clearly better than job losses, but for a long-term decline in the unemployment rate economists say job growth needs to be well above its current pace. Meanwhile, some of the figures underlying the report remain stagnant. The average workweek was essentially unchanged at 34.4 hours, while average hourly earnings dipped a penny to $23.58.
Wall Street barely budged before Friday morning’s report. Index futures were flat leading into the number, made a brief charge, then fell back to nearly break-even with Dow Jones industrial average futures two points lower and S&P 500 futures up by less than a point.
J.J. Kinahan, chief derivatives strategist at TD Ameritrade, says the market may have some gyrations around the open, but he expects a pretty quiet session Friday that could extend into the start of next week. ”It’s a tough election to stick your neck out on,” for an investor, Kinahan says.
While the presidential election gets the bulk of the headlines, the House and Senate elections are likely to have a greater impact on whether the fiscal cliff gets resolved. That story concerns traders, “and is even harder to call,” Kinahan says, leading many to seek some short-term safety in bond funds that can deliver a minimal return as a parking space.
Among the stocks on the move Friday morning wasChevron, down 1% pre-market after earnings and revenue that were lighter than estimates a day after rival Exxon Mobil recorded a big boost in refining profits that helped boost its numbers.
Starbucks, which recorded a strong quarterly report after the bell Thursday, was up 8.9%. American Intl Group fell 3.7%, after the company delivered earnings and Chief Executive Robert Benmosche said losses from Hurricane Sandy will not be a problem for the insurer.
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