Another Solid Month for the Job Market

November 04, 2019

The U.S. labor market stood strong against headwinds in October.

Nonfarm payrolls increased 128,000 last month, higher than consensus estimates for an 85,000 gain. October’s payrolls beat expectations despite a 42,000 slide in automaker payrolls, largely from the General Motors strike. August and September’s job gains were also revised up by 95,000.

As shown in the LPL Chart of the Day, payrolls have grown an average of 175,000 over the past 12 months, around the average pace for this economic expansion.

Solid October jobs data shows the engine of the U.S. economy is humming along despite elevated global uncertainty, a good sign for future growth as improving hiring conditions fuel consumer spending and confidence. Payrolls growth has moderated this year, but we’ve also expected some slowing in hiring as the cycle ages and the labor market tightens further.


“Jobs are growing at a solid pace,” said LPL Financial Senior Market Strategist Ryan Detrick. “Some investors have feared that trade tensions and global weakness could curb U.S. hiring, but the October jobs report shows that hasn’t been the case yet.”

Underlying details of the October jobs report were also encouraging. The unemployment rate was 3.6%, still near a cycle low. Average hourly earnings grew 3% year over year in October, a pace we think could buoy personal incomes without raising concerns about overheating.

The labor force participation rate, which measures the amount of the working-age population that is employed or actively looking for jobs, rose to its highest level since June 2013. That’s an especially favorable development, as we typically see workforce participation rise when consumers have a positive view of economic and labor-market conditions.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. All performance referenced is historical and is no guarantee of future results.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This Research material was prepared by LPL Financial, LLC.

Securities and advisory services offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (Member FINRA/SIPC).  Insurance products are offered through LPL or its licensed affiliates. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL is not an affiliate of and makes no representation with respect to such entity.

If your advisor is located at a bank or credit union, please note that the bank/credit union is not registered as a broker-dealer or investment advisor. Registered representatives of LPL may also be employees of the bank/credit union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, the bank/credit union. Securities and insurance offered through LPL or its affiliates are:

Not FDIC or NCUA/NCUSIF Insured | No Bank or Credit Union Guarantee | May Lose Value | Not Guaranteed by Any Government Agency | Not a Bank/Credit Union Deposit


For Public Use | Tracking #1-911968