Jobs Bounce Back from Hurricanes -- but Not Fully
|GDP||2.2% pace in '17, 2.6% in '18 More »|
|Jobs||Hiring pace should slow to 175K/month by end '17 More »|
|Interest rates||10-year T-notes at 2.4% by end '17 More »|
|Inflation||2.1% in '18, up from 1.9% in '17 More »|
|Business spending||Rising 3%-4% in '17, after flat '16 More »|
|Energy||Crude trading from $50 to $55 per barrel in February More »|
|Housing||Existing-home sales up 1.3% in '17 More »|
|Retail sales||Growing 3.8% in '17 (excluding gas) More »|
|Trade deficit||Widening 6% in '17, after nearly flat '16 More »|
Employment jumped by 261,000 in October, as 111,000 workers in food services, amusement parks and recreation — affected by the hurricanes that hit Texas, Louisiana and Florida — came back because their establishments reopened. Besides these, there was good growth in manufacturing, delivery and warehousing, temporary help, health care and family services. Approximately 35,000 more workers should come back to work in the next few months. They include staff at grocery stores, restaurants, day care facilities and nursing homes in Texas’s flooded residential areas.
Job growth unrelated to the hurricanes dropped to 150,000 in October. Growth has averaged 169,000 monthly slots this year, but will likely drop to roughly 160,000 in 2018 as the labor market tightens. Also, although the increase in e-commerce sales is adding delivery and warehousing jobs, they are not offsetting the losses at traditional retailers.
Unemployment dropped to 4.1% in October. Look for 3.9% next year as it becomes harder for employers to find suitable candidates.
Tight labor markets are also evident in the high number of available jobs in health care, food services, construction, transportation and warehousing. Openings in construction are at their highest level in 10 years.
Nonsupervisory wage gains in October ticked down to 2.3%; they were 2.4% for all employees. Wage growth has been stuck around 2.5% for a couple of years. However, it is likely that labor market tightness will begin to push up wage growth in 2018, and it should reach 3% by the end of next year.