US hiring slows but hurricane fallout blurs findings

November 1, 2024

(WASHINGTON) -- U.S. hiring slowed in October, but fallout from hurricanes and labor strikes likely caused an undercount of the nation’s workers.

A fresh jobs report marked the final piece of major economic data before Election Day. However, the data offers little more than a blurry snapshot of the U.S. economy due to the one-off disruptions last month.

Employers added 12,000 workers last month, falling short of economist expectations of 90,000 additional jobs, U.S. Bureau of Labor Statistics data on Friday showed. The unemployment rate stands at 4.1%, which matches the previous month's level and remains historically low.

The hiring in October amounted to a sharp slowdown from 254,000 jobs added in September, though it should be interpreted with a significant dose of caution, experts told ABC News prior to the data release.

“Workers who weren’t paid during the survey period due to work disruptions won’t be counted as employed, and workers and businesses may be too busy dealing with the aftermath of the storms to respond to surveys,” Martha Gimbel, executive director of the Budget Lab at Yale University and former director of economic research at Indeed, told ABC News in a statement.

Hurricane Milton made landfall in Florida as a Category 3 hurricane on Oct. 9. It ultimately left millions without power and much of the state’s gas stations without fuel. In late September, Hurricane Helene made landfall in Florida, prompting recovery efforts that have continued for weeks afterward.

Additionally, roughly 33,000 Boeing workers walked off the job in mid-September, an action that's expected to manifest as missing jobs for the first time on the October report.

In all, the combination of hurricanes and work stoppages is estimated to have pushed the level of hiring 50,000 jobs lower than where it otherwise would have stood, Bank of America Global Research said in a note to clients this week.

“This probably weighed on payrolls across the board, especially leisure and hospitality,” Bank of America Global Research said, pointing to Hurricane Milton. “There was also likely a minor drag from Helene,” the bank added.

Despite an overall slowdown this year, the job market has proven resilient. Hiring has continued at a solid pace; meanwhile, the unemployment rate has climbed but remains near a 50-year low.

The latest hiring data arrived at the end of a week in which new releases showed an economy growing at a robust pace while inflation returns to normal levels.

U.S. GDP grew at a 2.8% annualized rate over three months ending in September, U.S. Bureau of Economic Analysis data on Wednesday showed. That figure fell slightly below economists' expectations, but demonstrated brisk growth that was propelled by resilient consumer spending.

On Thursday, the Federal Reserve’s preferred inflation gauge showed that prices rose 2.1% over the year ending in September. Inflation has slowed dramatically from a peak of about 9% in 2022, though it remains slightly higher than the Fed's target of 2%.

The jobs report is set to arrive four days before Election Day. It also marks the last piece of significant economic data before the Fed announces its next interest rate decision on Nov. 7.

The Fed is expected to cut interest rates by a quarter of a percentage point, according to the CME FedWatch Tool, a measure of market sentiment.