October’s Jobs Report Beat Expectations, but 1.96 Million Have Been Out of Work 6+ Months

Episode Overview

The economy added 165,000 jobs in October, about three times the prior 12-month average of 48,000, according to the Bureau of Labor Statistics. August and September were also revised up by a combined 84,000, and the unemployment rate dipped to 4.1%. Pete and Peter say the headline hides a harder story.

Nearly 2 million people (1.96 million) have been unemployed for six months or longer, which is 27.6% of everyone out of work. The longer the gap, the harder the next job gets: savings run down, retirement plans take a hit, and employers often read a long resume gap as a red flag. The number of people working part-time because their hours were cut rose by 339,000, and about 8.8 million Americans now hold more than one job.

ADP’s private payroll count came in much lower, at 86,000, and the two reports disagree sharply by sector. Pete and Peter explain why they lean toward ADP’s payroll data. They also cover jobless claims near their lowest level since 1969, which points to a low-hire, low-fire market. The episode closes with NFIB’s October survey, where 86% of small business owners trying to hire said they found few or no qualified applicants, and with “entry-level” postings that ask for years of experience.

Key Takeaways

• The BLS reported 165,000 jobs added in October, with August and September revised up a combined 84,000. Unemployment fell to 4.1%.
• 1.96 million people have been unemployed for 27 weeks or more, which is 27.6% of all unemployed workers.
• The number of people working part-time because their hours were cut rose by 339,000, to 4.8 million.
• About 8.8 million Americans work more than one job.
• ADP counted 86,000 new private jobs. Professional and business services rose 70,000 in the BLS data but fell 27,000 in ADP’s.
• 86% of small business owners hiring or trying to hire reported few or no qualified applicants (NFIB).
• Advice from Pete and Peter: if you have a job, don’t quit without another one lined up. Employers who loosen rigid requirements and pay market rates will widen their candidate pool.