U.S. October Payrolls Rise 126,000; Jobless Rate Falls to 6% Nov. 7 (Bloomberg) -- The U.S. economy gained jobs for a third month in October, and the unemployment rate fell to 6 percent, giving fuel to a recovery that started two years ago. Payrolls rose by 126,000 last month, almost twice as much as expected, the Labor Department said in Washington. Revisions raised the number of jobs gained in September to 125,000, and August changed from a decline to a 35,000 gain. The jobless rate fell from 6.1 percent, the first decline since August. The fastest pace of economic expansion in 19 years, rising productivity and profit gains have positioned companies to start hiring again. The increased payrolls may also encourage more household spending after consumers used up tax refunds and the proceeds from refinancing mortgages. ``All the pieces of a typical expansion are falling into place,'' said Louis Crandall, chief economist at Wrightson ICAP LLC, in Jersey City, New Jersey, before the report. ``We are using up other available resources very quickly at this point, so that will lead to a need for increased labor.'' Payrolls in services, the largest part of the economy, rose. Manufacturing employment had the smallest decline in more than three years. The job numbers, after more than a week of favorable reports on manufacturing, services and consumer sentiment, may also help President George W. Bush fight criticism about his handling of the economy going into next year's election. Expectations Economists had expected payrolls would rise by 65,000 last month after a previously reported increase of 57,000 in September, according to the median of 68 forecasts in a Bloomberg News survey. Forecasts had ranged from no gain to 150,000 jobs added. Economists had projected the unemployment rate would hold at 6.1 percent. Services accounted for all the gains. Employment in service-producing industries, which include retailers, banks and government agencies, rose by 143,000 last month after gaining by 138,000 the previous month. The increase was led by a 56,000 rise in education and health services employment. A 43,000 rise in business and professional services, which include temporary employment agencies, contributed to the rise as well. Average weekly hours worked for all employees rose to 33.8 hours in October from 33.7 the prior month. Economists had expected hours would rise to 33.8 hours, according to the Bloomberg News survey. A longer workweek may be a precursor to future hiring, economists said. Jobs `Revival' Federal Reserve Chairman Alan Greenspan said yesterday he expects hiring to increase as companies begin rebuilding inventories depleted during the July-September quarter, when the 7.2 growth pace for the economy was the fastest in 19 years. The economy has lost more than 1 million jobs since the last recession ended in November 2001, and more than 2.6 million since Bush took office in January 2001, based on Labor Department figures before today's release. ``The odds, however, do increasingly favor a revival of job creation,'' Greenspan told the Securities Industry Association yesterday in a televised speech. Factory employment declined for a 39th month. Manufacturers shed 24,000 jobs last month, the fewest since July 2000, the last time there was an increase. Factory job losses have averaged 53,000 a month for the previous 12 months. The manufacturing workweek held at 40.5 hours. Overtime held at 4.2 hours. Incomes increased last month. Workers' average hourly earnings rose 0.1 percent, or 1 cent, after no change the previous month. Economists had expected a 0.2 percent increase in hourly wages. Average weekly earnings rose to $522.55 last month from $520.67 in September. Economic Growth Consumer spending grew the most in six years during the third quarter, while business investment in equipment and software rose at the fastest pace since the first quarter of 2000, Commerce Department figures showed last week. The economy is expected to grow at a 4 percent annual rate this quarter and maintain that pace next year, according to the median estimate of economists surveyed by Bloomberg News this month. The U.S., the world's biggest economy, grew at an average 3.6 percent pace during the record 10-year expansion from 1991 to 2001. ``We are looking forward to that acceleration in the economy in our business area, so we are actually hiring at a fairly strong clip right now,'' said Irwin Jacobs, chief executive of Qualcomm Inc., in a radio interview with Bloomberg News yesterday. ``We are having to do more research and development, and we have been adding people to do that.'' Claims San Diego-based Qualcomm, a maker of mobile-telephone technology, said fiscal fourth-quarter net income rose 53 percent. The company raised the forecast for first-quarter sales. Gains in payrolls may be accelerating this month. First-time claims for unemployment insurance benefits dropped to the fewest since January 2001, which was two months before the economy slumped into recession, the Labor Department reported yesterday. If claims stay close to that level, ``we will probably be revising up our expectations of job growth over the next quarter or two,'' said Robert Mellman, an economist at J.P. Morgan Securities Inc. in New York, before the report. J.P. Morgan economists are currently projecting an average of 75,000 jobs will be created a month in the next couple of quarters. ``We are currently actively hiring,'' said Alfred Mockett, chief executive officer of American Management Systems Inc., a Fairfax, Virginia, provider of consulting services to government agencies and businesses, in an interview Tuesday. ``Just based on our current backlog and pipeline, we are going to have to step up our hiring as we go into next year. I can foresee a situation where the whole industry is going to get into recruitment mode next year.'' Productivity Mockett said he would like to see the economy grow in the 4 percent to 5 percent range this quarter to be more certain the recovery is sustainable. American Management announced in July that it was cutting jobs amid a decline in second-quarter revenue. Companies are adding workers after reaching the limit of what they can obtain from their present staff. Productivity surged to an 8.1 percent annual rate of growth last quarter after a 7 percent gain in the previous three months, the Labor Department reported yesterday. ``The combination of faster growth in demand and slowing productivity growth should lead, in the next few quarters, to increased hiring,'' Fed Governor Ben Bernanke told participants in an investment outlook conference in Pittsburgh yesterday. Profits Productivity has grown at a 7 percent annual pace or higher during 27 quarters since the end of World War II. In the subsequent three-month periods, it dropped to an average of 1.9 percent growth while companies hired an average of 462,000 workers. Hiring declined in just four instances, the last being the third quarter of this year. Companies are more open to the possibility of taking on staff because earnings are rebounding. Of the 430 S&P 500 members that have reported third-quarter results so far, profits rose an average of 21.4 percent, according to Thomson Financial. Profits will swell 21.8 percent in the fourth quarter and 12.4 percent in 2004, according to analysts surveyed by the company. ``Companies are posting sales positions,'' said Jeff Taylor, founder and chief executive of Monster Worldwide Inc.'s Monster.com, the biggest U.S. Internet site for employment advertising, in a television interview with Bloomberg News yesterday. ``This is critical because it means companies have confidence in the future. We see a heavy amount of small- and medium-sized company postings.'' Blacks, Teenagers Among blacks, the unemployment rate rose to 11.5 percent from 11.2 percent in September. The jobless rate for Hispanics decreased to 7.2 percent from 7.5 percent and for whites fell to 5.1 percent from 5.3 percent. For teenagers, unemployment dropped to 17.1 percent last month from 17.5 percent. The jobless rate for women fell to 5.2 percent from 5.3 percent. The jobless rate for men decreased to 5.6 percent from 5.7 percent. The optimism among employers isn't uniform. ``Most companies are going to wait to see if this is sustainable'' before hiring in earnest, said John Chambers, chief executive of Cisco Systems Inc., the world's largest maker of equipment to link computers, in an interview this week. They will start by spending more on equipment and software and ``then they are going to start spending on their hiring'' a couple of quarters later, he said. Sales at Cisco, based in San Jose, California, were the highest in almost three years.''
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Originally posted by miko2d Sixpence: Hooked him, although I was expecting a longer post;) The ones who are hooked are those who finance the wrong kind of jobs creation with their forced savings. miko
Originally posted by muckmaw He's fighting ya....*damn, I wish I knew more fishing terms*
