In the final days leading up to the presidential election, the government is set to release its last snapshot of the United States' employment and unemployment status.
This comes at a time when the economy's health has been a pivotal issue for voters. However, the upcoming report is anticipated to present some of the most skewed monthly employment figures in recent years, due to temporary factors such as hurricanes and worker strikes that have suppressed job growth in October.
As reported by ABC News, the report's release coincides with attempts by Republican allies of Donald Trump to cast doubt on the economy's health and undermine confidence in the credibility of these monthly jobs reports. Trump and his supporters have consistently criticized the Biden-Harris administration for the inflation surge that reached its peak two years ago before gradually subsiding. Despite a healthy job market characterized by robust job growth, minimal layoffs, and low unemployment, Trump has labeled the United States as a "failing nation." He has promised that his plan to impose sweeping tariffs on all imported goods would revive millions of manufacturing jobs.
The monthly jobs data usually provides a clear picture of the economy's health. However, economists estimate that the combined effects of Hurricanes Helene and Milton, along with the ongoing Boeing machinists' strike, have significantly reduced hiring in the past month by approximately 60,000 to 100,000 jobs. These job losses are believed to be temporary.
Economists predict that Friday's report will reveal that only 120,000 jobs were added in October, as per data provider FactSet. This figure is respectable but less than half of September's unexpectedly strong gain of 254,000. The unemployment rate is projected to remain low at 4.1%.
Taking into account the impact of the hurricanes and strikes, these figures still indicate a robust job market. This resilience is surprising given the Federal Reserve's high interest rates and is largely attributed to healthy consumer spending. Jane Oates, a former Labor Department official during the Obama administration, praised the economy's resilience, attributing its strength to consumer spending.
However, there may be other effects that are more challenging for the government to measure. For instance, the Labor Department believes that the Boeing machinists' strike, along with a smaller walkout by some hotel workers, reduced job growth by 41,000 in October. Additionally, some of Boeing's suppliers may have also cut jobs due to reduced sales resulting from the strike. The impact of these job losses on the October employment figures is unclear.
Conversely, the hurricanes might have caused fewer job losses than economists expect. A worker would need to lose pay for an entire pay period, often two weeks, for their job to be considered lost in the government's data. While many workers in North Carolina likely experienced this, it's uncertain whether employees in Florida, which is more accustomed to hurricanes, would have missed that much work.
The upcoming jobs report will be the last significant snapshot of the economy before the Federal Reserve's next meeting on November 7, two days after the election. Most economists anticipate the Fed will reduce its benchmark rate by a quarter-point, following a substantial half-point cut in September.
If the jobs report suggests that hiring remained healthy in October, excluding the effects of the hurricanes and strike, Republican political figures may again question its credibility. Last month, when the government reported an unexpected jump in hiring in September, Senator Marco Rubio, a Republican from Florida, baselessly claimed that the report was "fake."
However, no mainstream economists share such skepticism. Other indicators, such as the number of people seeking unemployment benefits, also suggest a still-solid job market. Julia Pollak, chief economist at ZipRecruiter, expressed her dismay at the degree to which politicians have questioned the credibility of the jobs report, praising the Labor Department's Bureau of Labor Statistics for its transparency.
Trump and other critics have used the revisions often made to the government's initial estimates as evidence for their false claim that the Biden-Harris administration has manipulated the data. Erica Groshen, a senior economic adviser at Cornell University and a former commissioner of the BLS, explained that such revisions are a standard part of the government's data-gathering process.
Trump's running mate, Senator JD Vance, has frequently tried to undermine positive hiring data by claiming that all the jobs created in the past year have gone to immigrants. This claim is based on the fact that the number of "foreign-born" people with jobs increased by 1.2 million in September from a year earlier, while the number of native-born workers with jobs fell by about 800,000.
However, the "foreign-born" category includes people who have been in the United States for years, including from childhood, and who are now citizens, as well as recent immigrants, both authorized and unauthorized. Furthermore, the retirement of native-born Americans in large numbers is a significant factor in the difficulty many employers face in filling jobs. As the baby boom generation ages, the proportion of Americans ages 65 and older has risen to 17.3%, up from just 13.1% in 2010, according to Census Bureau data.
Moreover, the unemployment rate for native-born Americans, at 3.8%, is actually lower than the jobless rate for foreign-born workers, at 4.2%. This data further underscores the complexity and nuance of the employment landscape in the United States, a reality that is often overlooked in the heated rhetoric of the election season.
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