{"id":1618,"date":"2019-11-01T12:25:47","date_gmt":"2019-11-01T16:25:47","guid":{"rendered":"https:\/\/naroffeconomics.com\/?p=1618"},"modified":"2019-11-01T12:25:47","modified_gmt":"2019-11-01T16:25:47","slug":"october-jobs-report-supply-managers-manufacturing-survey-and-september-construction","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=1618","title":{"rendered":"October Jobs Report, Supply Managers\u2019 Manufacturing Survey and September Construction"},"content":{"rendered":"\n

KEY DATA:<\/strong>  Jobs: 128,000, Private, 131,000, Revisions:\n+95,000, Vehicles: -41,600; Unemployment Rate: 4.6% (up from 4.5%); Wages:\n+0.2%\/ ISM (Manufacturing): +0.5 point; Orders: +1.8 points\/ Construction:\n+0.5%<\/p>\n\n\n\n

IN A\nNUTSHELL:<\/strong>  \u201cRemember all those stories about the job\ngrowth fading, well never mind.\u201d<\/em><\/strong><\/p>\n\n\n\n

WHAT IT\nMEANS:<\/strong> So\nmuch for a slowing job market.  Yes, the\ntotal number of net new hires in October was nothing spectacular but that was\nsimply because GM was on strike <\/em><\/strong>and those workers were not considered\nto be employed.  With the strike settled,\nthe November report will reflect their return to work.  Excluding the motor vehicle sector, hiring\nwas good <\/em><\/strong>with solid gains posted in health care, construction,\nwholesale trade, financial activities, retail and especially restaurants. As\nfor the government, cut backs in census workers led to a sharp decline in\nfederal payrolls.  That is just an\nunwinding of the increases we saw previously.<\/em><\/strong>   Those ups and downs will be repeated this\nspring when we actually take the census. <\/em><\/strong> As for wages, they rose decently <\/em><\/strong>and\nthe year-over-year decline was reversed slightly.  Finally, the modest rise in the unemployment rate\nshould not be viewed as a concern.  The\nlabor force grew solidly and the participation edged up and those are signs of\na vibrant labor market.<\/em><\/strong><\/p>\n\n\n\n

Manufacturing activity continues to moderate, but\nthe decline eased in October.  The\nInstitute for Supply Management\u2019s Index rose, though it remained in negative\nterritory<\/em><\/strong>.\n Most of the components posted gains,\nthough production did fade further.  All\nof the components, except for export orders, are still below 50.  In other words, the sector is slowing at a\nslower pace.<\/p>\n\n\n\n

Construction activity picked up in September and the\nincreases were broad based. <\/em><\/strong> Residential,\nnonresidential, private and public all posted gains.  That said, private activity remains down\nover the year and it is largely the public sector that is driving construction.<\/em><\/strong>MARKETS AND FED POLICY IMPLICATIONS:<\/strong> After\nseveral months of reporting decelerating job gains, the Bureau of Labor\nStatistics discovered a ton of new jobs they missed in August and September and\nthe additional positions changed the tenor of job gains.<\/em><\/strong>  When you consider the negative impact that\nthe GM strike had on the October numbers, it is clear that the labor market is stronger than\nwe perceived going into today\u2019s report.  And\nthat raises even more questions about why the FOMC cut rates again this week.<\/em><\/strong>  Let\u2019s face it, the Fed is largely out of\nbullets.  Yes, they have six more\nquarter-point moves before they get to zero, but the reality is that once the\none percent level is hit, any additional cuts could reduce investment rather\nthan increase it. <\/em><\/strong> Households and\nbusinesses will likely recognize that the only reason the Fed would be going so\nlow is that the economy is in trouble and really, who borrows money when they\nare worried about a faltering economy? Lowering rates to feed the market beast\nwhile emptying the arsenal needed to fight a recession, especially when cutting\nrates is not a necessity, is not good monetary policy.<\/em><\/strong>  What will the Fed do when we really need rate\ncuts, such as when the economy actually falters?  Got me. \nMaybe that should be the question that is asked of Fed Chair Powell the\nnext time he talks.  So, where\nwill the Fed go from here?  My guess is\nthat it is on hold for quite some time. \nThis report makes it awfully hard for the FOMC to cut rates again in\nDecember.  <\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

KEY DATA:  Jobs: 128,000, Private, 131,000, Revisions: +95,000, Vehicles: -41,600; Unemployment Rate: 4.6% (up from 4.5%); Wages: +0.2%\/ ISM (Manufacturing): +0.5 point; Orders: +1.8 points\/ Construction: +0.5% IN A NUTSHELL:  \u201cRemember all those stories about the job growth fading, well never mind.\u201d WHAT IT MEANS: So much for a slowing job market.  Yes, the total … Continue reading October Jobs Report, Supply Managers\u2019 Manufacturing Survey and September Construction<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1618","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1618","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1618"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1618\/revisions"}],"predecessor-version":[{"id":1619,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1618\/revisions\/1619"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1618"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1618"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1618"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}