The U.S. economy remains strong! 165,000 new jobs were created in October, far exceeding expectations, and the unemployment rate fell to 4.1%

The U.S. added jobs at a much stronger pace than expected in October. The U.S. Bureau of Labor Statistics announced on the 6th that after seasonal adjustment, 165,000 new non-farm jobs were added in October, much higher than the 59,000 expected by Dow Jones. The unemployment rate also fell to 4.1% from the 4.2% expected last month.

The more comprehensive unemployment rate index, which includes timid workers who have stopped looking for a suitable job and part-time workers due to economic factors, rose by 0.3 percentage points to 7.9%, and the labor force participation rate rose slightly to 61.9%.

In addition to strong new employment in October, the Bureau of Labor Statistics also significantly revised up relevant data from a few months ago, from 53,000 previously announced to 186,000 in August, and from 31,000 to 60,000 in September.

Wage growth was also better than expected. Average hourly earnings in October increased by 0.4% monthly and 3.1% annually, higher than expectations of 0.3% and 2.9% respectively. The average weekly working hours was 34.4 hours, the same as last month.

Seema Shah, chief global strategist at Principal Asset Management, said, "This employment report effectively refuted doubts that the economy may slow down significantly; employment growth was unexpectedly solid, the unemployment rate fell back to 4.1%, and new jobs were widely created, showing that the U.S. economy can still easily absorb labor, rather than starting to slump under the tightening financial environment."

Different from the previous trend of medical care accounting for the dominant position in new employment, the breadth of employment growth in October was also quite comprehensive. Professional and business services added 70,000 new jobs, leading all industries. Health care added 42,000 new jobs. Other significant growth in employment included transportation and warehousing (25,000) and manufacturing (19,000).

The report comes at a time when the Democratic Party has swept the midterm elections this cycle and is about to take control of both houses of Congress. During this election campaign, the issue of inflation received particular attention, and the Democratic Party vigorously promoted affordable policies.

The report also comes at a critical time for the Federal Reserve (Fed). With inflation still well above its 2% inflation target, the Federal Reserve is weighing whether to resume raising interest rates at its December meeting.

After the Bureau of Labor Statistics report, traders increased their bets on a 1-point (0.25 percentage point) interest rate hike at the Federal Open Market Committee's December meeting. The chance has risen to 76.8%, according to the CME Group's FedWatch tool, but the indicator suggests there may only be one more rate hike after that. The chances of further interest rate hikes next year have declined in the past few days amid the midterm election results and the recent severe sell-off in technology stocks.