Companies continued to hire at a brisk pace in October, with private payrolls rising by a better-than-expected 227,000, according to a report Wednesday from ADP and Moody's Analytics.And when business men can't find qualified workers for the price they're offering, they often raise their offers, hence:
Economists surveyed by Refinitiv had expected growth of 189,000 after September's 218,000, which was revised lower from an initial count of 230,000.
Gains came primarily from the services sector, which added 189,000 positions. Construction and manufacturing added 17,000 each. At an industry level, trade, transportation and utilities was the biggest contributor with 61,000 new positions.
Leisure and hospitality contributed 40,000, while professional and business services added 36,000 and education and health services grew by 31,000.
In terms of company size, big businesses that employ 500 or more workers led the way with 102,000. Small businesses, which have paced much of the recovery, lagged with just 29,000 new hires, another sign of a tightening job market where qualified workers are getting harder to find.
Wages and salaries jump by 3.1%, highest level in a decade
Employment costs rose more than expected in the third quarter in a sign that more inflation could be brewing in the U.S. economy. The Labor Department's employment cost index rose 0.8 percent for the period, ahead of the estimate of 0.7 percent from economists surveyed by Refinitiv. Wages and salaries rose 0.9 percent, well ahead of expectations for 0.5 percent. Benefit costs were up 0.4 percent. On a yearly basis, wages and salaries jumped 3.1 percent, the biggest increase in 10 years.The Democrats really need to get into power to head off this trend. Imagine people getting off welfare and imagining that they didn't really need to Democrats to give it to them.
Wage increases have been the missing link in the economy since the recovery began in mid-2008. Average hourly earnings have been rising steadily but have stayed below the 3 percent level as slack has remained in the labor market.
However the unemployment rate is now at 3.7 percent, the lowest since 1969, and wage pressures have begun to build. The Federal Reserve has been raising interest rates in an effort to stave off future inflationary pressures, though the central bank's preferred gauge of inflation rose just 2.5 percent in the third quarter, including a 1.9 percent increase for health benefits.
"The employment cost index data adds to the broader evidence that wage growth has continued to trend gradually higher over recent quarters," Michael Pearce, senior U.S. economist at Capital Economics, said in a note. "And with labor market conditions still tightening, we expect wage growth will accelerate further from here."
Linked at Pirate's Cove in the weekly "Sorta Blogless Sunday Pinup" and links.