A strike sign is seen on display as Boeing workers gather on a picket line near the entrance to a Boeing facility during an ongoing strike on Thursday, Oct. 24, 2024, in Seattle. Experts say a pair of major hurricanes and labor strikes influenced a weak jobs report for October, the final one U.S voters will see with only days left in the presidential campaign. (Photo by David Ryder/Getty Images)
U.S. businesses added only 12,000 jobs in October, the Labor Department announced Friday, in a weak final jobs report heading into the final days of the presidential election. But experts say a pair of major hurricanes and labor strikes in manufacturing, hotels, and cargo transport obscure the view of the economy – a key issue for voters picking who should lead the country.
The unemployment rate held steady at 4.1% after falling a tenth of a percentage point the prior two months.
Strikes in October made it challenging to meaningfully understand the “abysmal” jobs number, said Lauren Saidel-Baker, an economist at ITR Economics, a nonpartisan economic research and consulting firm based in New Hampshire.
“That’s really where we see the difference between, say, the unemployment rate – that was steady at 4.1% – against this very disappointing jobs figure,” she said. “Those are two different surveys. One is from households and one is from businesses, and so with a strike, a striking worker can say, ‘I’m still employed. I haven’t lost my job. I’m just temporarily absent from it.’ Whereas the employer says they’re not here, they’re not working. This isn’t a job.”
The number of jobs added was far below Goldman Sachs analysts’ forecast of 95,000 jobs this month.
Manufacturing jobs fell by 46,000 last month, with the vast majority of these numbers reflecting a massive strike. Job growth was projected to fall by at least 50,000 jobs or more in October in most estimates, according to the Economic Policy Institute, a left-leaning economic think tank. The number of hours worked was also expected to change, but average weekly hours remained the same.
Tens of thousands of machinists at Boeing have been on strike since September for increased pay and better retirement benefits in September. Hotel chain workers have also been striking over health benefits and hiring to lessen the workload after COVID-19 pandemic-related staffing cuts. The unemployment rate for leisure and hospitality was 6% compared to 5.5% a year ago. In early October, dockworkers stopped work for a few days for better wages and a ban on automation.
Hurricane Helene ripped a path from Florida to the Carolinas in late September and is blamed for more than 200 deaths. Hurricane Milton followed just weeks later in October, devastating more communities in Florida.
Economists expected to see this show up in the jobs data.
Carlos Martin, a senior fellow at Brookings Metro, said that although climate displacement of households is an issue, a lot of people stay where their job is. But if their job no longer exists because businesses have left or ended operations, that could mean a lot for the population.
“I’m curious on how [the hurricanes] affects the businesses there, including the small and medium-sized businesses. Are they going to leave?,” he said.“If businesses aren’t coming back, employment is not going to be maintained or go up in these places. That’s where you’re going to have major population loss.”.
Many of the same trends seen in past jobs reports continued in October’s report, including the addition of jobs in healthcare, government, and construction, but professional and business services fell by 49,000 jobs.
Wages rose 0.4% in October and increased 4% over the past year. The labor force participation rate and employment-population ratio, which have been strong in past reports, did not change significantly over the past month or past year.
The category of permanent job losers, or people who did not voluntarily end their employment and who began looking for work, also increased, to 1.8 million in October. Saidel-Baker said that although this is something to watch for in future reports, she doesn’t see it as something to worry about now.
Economists are also watching the jobs report closely to see what influence it may have on the Federal Reserve’s decision to cut its key rate, which affects everything from credit cards to mortgage rates. The Personal Consumption Expenditures index fell to 2.1% year over year in September — low enough for economists to argue that the Fed should get ready to take deeper cuts.
“Today’s report shows that the two hurricanes we just experienced had sizable impacts on people’s ability to continue working. While that damage will likely be limited to this month’s report, job growth has been slowing in recent months and the Federal Reserve should not use it as an excuse to delay their planned rate cuts,” Lindsay Owens, executive director of Groundwork Collaborative, a progressive economic think tank, told States Newsroom on Friday.
But the Fed will likely not make any big changes in their decision-making due to one jobs report, particularly one this messy, Saidel-Baker said.
“I think the Fed has signaled pretty clearly that they will not be hanging on this one jobs number,” she said. “They know everything that went into it, the hurricanes, the Boeing strike, etc.”
Millions of people have already cast their ballots through the mail or early voting, and the final day of voting in the U.S. is Tuesday.
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