Hiring Picks Up

Today’s government report on employment brings welcome news: the recovery is generating jobs, and the pace seems to be steady.

The economy created 171,000 new jobs in October, which is many more than most analysts had expected. The unemployment rate, as often happens, went in the other direction, rising to 7.9%. Neither number is likely to have a very significant impact on the election – they simply confirm the well established trend we have been observing for a few months. The recovery is well set, but not very strong.

The gains in jobs were spread across the economy with the private sector adding 184,000 offset by the loss of a further 13,000 in government. The vast majority of the gains came in service industries: the somewhat amorphous professional services added 51,000; health care added 31,000; retail added 36,000; and leisure and hospitality businesses added 28,000. Even manufacturers chipped in by adding 13,000 after having seen job losses the prior two months.

The greatest significance of today’s numbers, though, is that they confirm September’s as not being a fluke. Recall that when the September figures were released the sharp drop in the unemployment rate and the historically high number of people reporting they had found work, became a political issue. Republicans went as saying the numbers were rigged to boost Obama’s election chances. Clearly that was not the case. The gains are real and have been sustained.

Now if only they would accelerate.