CHRISTOPHER S. RUGABER, AP Economics Writer
WASHINGTON (AP) — Three days after voters registered their sourness about the U.S. economy, the government said Friday that employers added a solid 214,000 jobs in October, extending the steadiest pace of job growth in nearly 20 years.
In addition, a combined 31,000 more jobs were added in August and September than the government had previously estimated. Employers have now added at least 200,000 jobs for nine straight months — the longest such stretch since 1995.
The burst of hiring lowered the unemployment rate to 5.8 percent from 5.9 percent. It is the lowest rate since July 2008.
“This was a great month for the American labor market,” said James Marple, an economist at TD Bank. “The U.S. job engine is not just chugging along; it is gaining speed.”
At the same time, Americans’ average hourly pay rose only slightly last month, a negative note in an otherwise solid report. Stagnant wages have been a chronic weakness in the job market since the recession officially ended more than five years ago.
Voters listed the economy as their top concern in Tuesday’s elections, and the sluggish pace of pay growth is a likely factor. Average hourly pay rose 3 cents in October to $24.57. That’s just 2 percent above the average wage 12 months earlier and barely ahead of a 1.7 percent inflation rate.
Still, the streak of consistently healthy job growth is highlighting a disconnect between the U.S. economy’s steady gains and stumbling economies overseas. Europe is on the brink of its third recession in the past seven years. Growth in China and Japan has weakened.
That’s why the U.S. Federal Reserve has finally begun to ratchet back its economic stimulus while other central banks, like the European Central Bank and the Bank of Japan, have been ramping up their efforts to fuel growth. Though the United States is a vital trading partner for other major nations, few think the U.S. expansion will be enough to help rejuvenate economies abroad.
Last month, the brightening U.S. jobs picture led more people to start looking for work. The percentage of Americans who either have a job or are looking for one rose in October to 62.8 percent. And 267,000 people who had been out of work said they were now employed. Their hiring reduced the number of unemployed to just under 9 million.
The job gains were broad-based, though many lower-paying industries posted especially large increases. Retailers added 27,100 jobs. Restaurants, hotels and entertainment firms gained 52,000.
Some higher-paying industries also showed progress. Manufacturers added 15,000 jobs, up from 9,000 the previous month. Transportation and shipping companies gained 13,300. And professional and business services, which includes accountants, engineers and other higher-skilled fields, added 37,000.
XPOLogistics, a shipping company, has hired 250 people in the past three months and has 300 open jobs. The company connects manufacturers, retailers and other firms that need shipping with independent trucking firms. It has opened a new office in Kansas City, Missouri, where it plans to hire 125 people.
Scott Malat, the company’s chief strategy officer, said that rising manufacturing output has helped drive growth.
“The economy has been better, and that plays right into our hands,” he said.
Analysts say the economic expansion remains strong enough to support the current pace of hiring. Over the past six months, the economy has grown at a 4.1 percent annual rate.
U.S. manufacturers are expanding at the fastest pace in three years, according to a survey by the Institute for Supply Management, a trade group. A measure of new orders showed that factory output will likely continue to grow in coming months. A separate survey by the ISM found that retailers, restaurants and other service companies grew at a healthy pace last month.
Home sales rose in September at their fastest rate this year, a sign that housing could pick up after a sluggish performance for most of this year.
Still, faltering global growth could create trouble for the U.S. economy in the months ahead. Exports fell in September, the government said this week, widening the trade deficit. That led many economists to shave their predictions of economic growth in the July-September quarter to an annual rate of 3 percent or less, down from the government’s initial estimate of 3.5 percent.
Contact Chris Rugaber at http://Twitter.com/ChrisRugaber.
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