US jobs growth at three-year high in October

US employers added the largest number of workers in nearly three years in October and wages increased. That could bring the Federal Reserve closer to raising interest rates.

Non-farm payrolls surged 321,000 last month, the most since January of 2012, the Labour Department said yesterday. The country’s unemployment rate held steady at a six-year low of 5.8%.

Data for September and October were revised to show 44,000 more jobs created than previously reported. Economists had forecast payrolls increasing by only 230,000 last month.

November marked the 10th straight month that job growth has exceeded 200,000, the longest stretch since 1994, and further confirmed the US economy is weathering slowdowns in China and the eurozone, as well as a recession in Japan.

There are signs the improving labour market conditions are starting to spur faster wage growth, a key factor that will determine the timing of the US central bank’s first rate hike.

Average hourly earnings rose 9c in November, which left them up 2.1% from a year ago. That is still well under the rise of 3%, or more, that economists say would make the Fed comfortable lifting benchmark overnight rates from near zero, where they have been since December 2008.

Reuters