U.S. employers hired workers at the fastest pace in seven months in October. Non-farm payrolls grew by a robust 337,000 in last month, more than twice the increase recorded in September, the Labor Department said today.
The numbers surprised Wall Street. Economists had called for a 192,000 increase in payrolls and a 5.4% unemployment rate.
The department also revised its estimates of payrolls growth for September and August, saying employers added more jobs than previously thought. That brought the total of jobs created over the last 13 months to 2.2 million.
The strong job growth drew previously discouraged workers back into the civilian labor force, expanding it by 367,000 to 147.9 million. The unemployment rate, as a result, rose a tenth of a percentage point to 5.5%.
Most economists now expect jobs to grow at a pace of 200,000 a month for the remainder of the year, although the unemployment rate isn’t expected to fall much.
The strong evidence of job creation suggests the Federal Reserve will continue its campaign of interest-rate increases, raising the key federal funds rate by a quarter percentage point to 2% when its policy makers meet next week.
The report showed the service-producing industry added 272,000 jobs in October, the largest increase since April.
The manufacturing industry, however, shed jobs for a second month in a row. Manufacturing jobs declined by 5,000 last month after a 14,000 decline in September.