Hurricanes help jump-start hiring with October payrolls expanding by 337,000
Friday, November 5th 2004, 8:39 am
By: News On 6
WASHINGTON (AP) _ Employers aggressively hired new workers in October, adding 337,000 people to their payrolls after a sluggish summer, but the unemployment rate rose fractionally to 5.5 percent.
The pace of hiring was the fastest in six months, nearly double what economists had forecast, the Labor Department reported Friday, saying cleanup efforts from hurricanes that struck Florida and much of the Southeast helped jump-start the labor market.
But the overall, seasonally adjusted jobless rate actually rose by 0.1 percentage point from the 5.4 percent rate of September because more people renewed their job searches, expanding the pool of available workers.
The jobs report was good news for President Bush as he prepares for a second term. A generally weak job market plagued his re-election campaign, offering a political target to his Democratic challenger, John Kerry.
Economists had expected October payrolls to grow by about 175,000 with the jobless rate holding steady at 5.4 percent. Employers have added about 2.2 million jobs since August 2003.
Hiring in construction helped spur last month's job growth, with employment in that sector rising by a net 71,000 jobs.
``Some of this unusually large gain reflected rebuilding and cleanup activity in the Southeast following the four hurricanes that struck the U.S. in August and September,'' said Kathleen Utgoff, commissioner of the Bureau of Labor Statistics.
In the past year, construction employment has grown by about 16,000 per month.
New jobs in professional and business services also helped strengthen overall job growth last month, with hiring expanding by 97,000. Temporary employment services were responsible for about half of that, giving ammunition to Bush critics who argue that much of the recent job growth is occurring in lower-paying work that typically doesn't offer heath insurance and other benefits.
October's job growth was the highest since March, when employers added 353,000 positions. Since that time, the pace had slowed, especially in June and July. But hiring has picked up since, growing by a revised 198,000 in August and 139,000 in September. Both figures were higher than originally reported by the Labor Department.
Manufacturing was the only major sector to lose jobs last month, with employment falling by a net 5,000. That followed a decline of 14,000 in September.
Some of the report showed a jobs market still struggling. The number of people who held more than one job rose by 519,000 to 8 million. The average time for the unemployed to find a job was 19.6 weeks, the same as in September.
The jobless rate for blacks jumped to 10.7 percent last month, up from 10.3 percent in September. The rate for Hispanics fell to 6.7 percent from 7.1 percent from the previous month, while the rate for teenagers grew to 17.2 percent from 16.6 percent. The rate for whites held at 4.7 percent.
But the economy is back on track, growing at a 3.7 percent annual rate in the third quarter, up from a 3.3 percent pace in the prior period.
Analysts think Federal Reserve policy-makers will continue to move rates from extraordinarily low levels to more normal levels to make sure inflation doesn't become a threat to the economy down the road.
The Fed is expected to boost short-term interest rates for a fourth time this year when it meets next week, pushing up a key rate from 1.75 percent to 2 percent.