The numbers: The U.S. regained 638,000 jobs in October and the unemployment rate fell sharply again to 6.9%, reflecting a surprising show of strength for the economy even as coronavirus cases rose to record highs.
Economists polled by MarketWatch had forecast 503,000 new jobs. U.S. stocks declined in early Friday trades though after a four day election week rally.
Private-sector employment rose by a more robust 906,000, but a sharp decline in government employment pulled down the overall total.
The better-than-expected employment report suggests the economic recovery is growing deeper roots, giving the next occupant of the White House some breathing room when he takes office in January. The latest election esults pointed to a narrow victory by Democrat Joe Biden.
The increase in hiring last month was largely concentrated in professional businesses, leisure and hospitality, and retail.
Unemployment sank to fresh pandemic low of 6.9% from 7.9% in September as more people went back to work, but economists say the official rate understates the true level of joblessness.
About 10 million of the 22 million jobs that were lost early in the pandemic still haven’t been recovered, however.
What happened: Hiring in October was strongest among white-collar companies in technology and other professional fields. They added 208,000 jobs.
Bars and restaurants also created 192,000 jobs while hotels hired 34,000 workers.
Hotels, restaurants and other businesses in leisure and hospitality have only brought back just over half of the 8.3 million jobs lost in the spring, however.
What’s more, a record increase in coronavirus cases, ongoing government restrictions and a collapse in travel are also likely to keep a lid on hiring in the months ahead. These businesses won’t be able to return to normal until the virus fades or a vaccine is discovered.
Retailers, for their part, increased payrolls by 104,000 and have recovered almost all the jobs that were wiped out during the first phase of the pandemic. Many have beefed up online sales and taken other measures to recoup business.
Employment in manufacturing, meanwhile, rose by 38,000 in October. Manufacturers have recovered just over half of the 1.35 million jobs that companies shed in March and April.
Construction jobs increased by 84,000. Business has been booming amid a surge in demand for new homes as families flee dense urban areas for more space and security from the pandemic. Record low mortgage rates have also helped.