At the end of a week in which nearly every labour market indicator was surprisingly strong — from the ADP to initial jobless claims to the ISM’s employment index — the one that matters most disappointed.
US payroll employment climbed by 162,000 and the prior two months were revised down by a combined 26,000. Read more
The employment situation report superficially appears as mixed as the other recent US labour market indicators: payrolls reasonably higher in the establishment survey, the unemployment rate ticks up in the household survey.
But the tickup in the unemployment rate is the result of a slight increase in the labour force participation rate; employment growth in the household survey actually climbed 319,000. Read more
— The 171,000 increase in payrolls is a solid number and better than expected, but the upward revisions to the prior two months, a combined 84,000 jobs, is at least as big deal. And as we wrote after the September payrolls, remember both that upward revisions to previous months tend to be followed by more such revisions, and that the initial headline payroll number roughly tends to underestimate job gains during expansions, and the amount of the underestimation correlates (again, roughly) to the sharpness of the recovery. Read more