Tiny cracks are beginning to emerge in the US labor market’s resilience to higher interest rates and surging prices, but plenty of strength remains to keep Federal Reserve officials focused on stamping out inflation.Businesses boosted hiring in October by 261,000, which was more than expected, and average hourly earnings accelerated from September, according to a Labor Department report Friday.
But the jobless rate rose to 3.7% from a more than five-decade low, the gain in payrolls was the smallest since the end of 2020 and the annual advance in earnings dipped below 5% for the first time since last year.
The broad takeaway is a job market that’s cooling albeit not very quickly. That lines up with Jerome Powell’s characterization earlier this week, when the Fed chair acknowledged conditions haven’t softened yet in an “obvious” way and said the central bank is eyeing a higher peak interest rate than it was two months ago.
