Job Market Dodges Blow from Government Shutdown
WASHINGTON -- U.S. job growth unexpectedly accelerated in October as employers shrugged off a government shutdown, suggesting the budget standoff had a more limited impact on the economy than initially feared.
Employers added 204,000 new jobs to their payrolls last month, the Labor Department said Friday. The unemployment rate, however rose to 7.3 percent from September's nearly five-year low of 7.2 percent.
The department said there had been no "discernible" impact on payrolls from the 16-day federal government shutdown, adding that it had received an above average response rate from employers to its survey.
The report also showed 60,000 more jobs created in September and August than previously reported, suggesting that the economy had upward momentum heading into the shutdown last month.
Economists polled by Reuters had forecast payrolls rising 125,000 in October and the unemployment rate ticking up a tenth of a percentage point to 7.3 percent.
%VIRTUAL-article-sponsoredlinks%Last month's job gains pushed them above the 190,000 average for the past 12 months. But there was some bad news as more people dropped out the labor force, pushing the participation rate to 62.8 percent, the lowest level since March 1978.
The department said the drop in the participation rate was not related to the government shutdown as furloughed government workers remained in the labor force.
The private sector accounted for all the job gains last month, with government payrolls shrinking 8,000.
Despite the better-than expected payrolls count, that is unlikely to change expectations of slower economic growth in the fourth quarter, given that consumer spending slackened and business inventories rose in the July-September period.