U.S. Economy Gains 165,000 Jobs in October as Unemployment Falls

The U.S. job market strengthened in October, with employers creating 165,000 positions according to a Labor Department report released Friday. The unemployment rate dropped to 4.1%, down from 4.2% in September. This marked the third consecutive month of job growth.

Data for August and September were revised upward by a combined 84,000 jobs. Health care, manufacturing, and business services led the monthly hiring gains. In contrast, the restaurant and construction sectors reduced their payrolls during the period.

Average wages rose 3.1% in October compared to the same period last year. This represented a slight acceleration in annual wage growth. However, the increase trailed the 3.7% inflation rate recorded in September.

Cory Stahle, an economist at the job-search site Indeed, noted that workers are currently losing ground financially. He stated that the longer this disparity persists, the more noticeable it becomes for employees. The cost of living has outpaced wage growth for much of the year, a trend attributed to higher energy prices following the conflict with Iran.

Consumer frustration over high prices influenced recent midterm elections, where Republicans lost their majorities in both the House and Senate. The Federal Reserve held its benchmark interest rate steady last week. The central bank maintained its focus on controlling inflation, a strategy enabled by the historically low unemployment rate. Investors anticipate the Fed will raise rates when policymakers convene in December.