U.S. private payrolls increased more than expected in October, offering more evidence of labor market resilience and suggesting that the Federal Reserve could continue to aggressively raise interest rates for a while.
The pick-up in private hiring shown in the ADP National Employment report on Wednesday was concentrated in the services sector, specifically the leisure and hospitality industry. But rapidly rising borrowing costs appeared to weigh on hiring in the goods-producing sector, with factories shedding jobs.
The report followed on the heels of government data on Tuesday showing an unexpected jump in job openings in September.
“A tight labor market and rising wages will complicate things for the Fed and the risk is the labor market could remain tight for quite some time,” said Jeffrey Roach, chief economist at LPL Financial in Charlotte, North Carolina.
Private employment increased by 239,000 jobs last month. Data for September was revised down to show 192,000 jobs created instead of 208,000 as previously reported. Economists polled by Reuters had forecast an increase of 195,000 private jobs.
The services sector added 247,000 jobs, with the leisure and hospitality industry accounting for 210,000 positions. Payrolls in the trade, transportation and utilities industry increased by 84,000 jobs.
But employment decreased in information, financial activities, professional business services as well as education and healthcare industries.
Click here to see the full report from Lucia Mutikani at Reuters via Yahoo Finance.