Employment might have ticked up in October, but overall it was a disappointing month for the labour market. The current pace of population growth requires strong job gains to keep up, and that’s not what came through. The result was a rise in the unemployment rate, after holding steady over the summer. Hours worked were also flat, confirming the subdued headline figure.
Overall, the numbers are in line with other data, like recent GDP readings, showing a stalled economy. Wage gains remained solid on a year-over-year basis, but it remains to be seen how long this will last, particularly as employer hiring appetite cools steadily. As of late October, job postings on Indeed were down 27% from a year earlier, with declines apparent in most sectors.
The silver lining from the labour market’s perspective is that the cooldown is starting from a relatively strong place. Job postings on Indeed were still up 18% from their pre-pandemic level, and on the flip side, October’s 5.7% unemployment rate is still low by historical standards. Nonetheless, the historic job seeker’s market that emerged from the pandemic is fading. The question heading into next year is how long the current funk persists, and whether it morphs into a more severe economic contraction.