Unemployment Rate Inches Back Up
The October jobs report essentially agrees with the rest of the current data on the economy—the economy is growing slowly, too slowly to bring down unemployment rapidly. In fact, the unemployment rate rose to 7.9 percent in October and the economy created about 171,000 jobs, roughly equal to the usual number of new workers in the labor force.
The October report partly reversed the mysterious drop in the unemployment rate in the September jobs report. At the time, J.D. Foster, Heritage’s Norman B. Ture Senior Fellow in the Economics of Fiscal Policy, predicted that September’s jobs report would be sorted out later:
The September household survey is one to set aside to wait for a more reliable report next month, which will almost certainly reverse the odd results from September. If it does, then we have both confirmation of the power of statistics and of the weakness in the economy.
With the jump back up in the unemployment rate in October to nearly 8 percent, we have at least the beginnings of an answer to the mystery.