US hiring stays subdued as October payrolls beat forecasts

what happened

Seeking Alpha reports that US hiring has stayed subdued even though the economy has grown strongly and unemployment has remained low. In September, the JOLTS survey showed job openings little changed though they reached a four-month high, while layoffs hit their lowest point in 18 months. Indeed Hiring Lab economist Cory Stahle said employers are now hiring at a pace not seen since 2013, and quits are at the lowest pace since 2015.

October payrolls data came in stronger than expected: the economy added 165,000 jobs against a consensus estimate of 62,000. Job growth for the prior two months was revised higher, and the unemployment rate fell to 4.1% from 4.2% in September. The article stresses that these figures remain subject to revision, so it is too early to say the labor market has left the low-hire, low-fire environment. Challenger, Gray & Christmas reported that October layoff plans were the lowest since 2023, with much of the announced hiring seasonal.

why it matters

What matters for markets is the mix of weak hiring and low layoffs: the economy keeps growing, but the labor market may prove fragile if job losses begin to rise. A strong October payrolls report reduces the risk of a sharp economic slowdown and feeds into expectations for Federal Reserve rates and US Treasury yields.

market impact

US dollar and Treasuries: strong payrolls support expectations of tighter Fed policy

• ▲US dollar pressure up — strong payrolls data supports expectations of tighter Federal Reserve policy

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