U.S. Job Growth Signals A Positive Economic Outlook

10/4/24 - The U.S. economy added 254,000 jobs in September, higher than the annual monthly average of 203,000 and the expectation of 150,000 new jobs. This is good news for the economy as it signals the labor market is steady. Unemployment has dropped to 4.1% for September from 4.2% in August. Payrolls increased in most sectors including: restaurants, healthcare, construction, and government.

The Federal Reserve Board made a more aggressive interest rate cut of 50 basis points rather than the expected 25 basis points in September, partly in response to a cooling labor market from the August report. All eyes will be on the October jobs report, which is set to be released on November 1st, just days before the election. Data from the October report could be significantly disrupted from the devastation from Hurricane Helene, the ongoing Boeing machinists' strike and the short-lived but massive strike at U.S. ports along the East and Gulf Coasts. This report will be very important in determining the November policy decision.

The September labor market report does provide optimism and increases the odds that the economy will continue to grow above trend in the next quarter. As has been the case, we remain constructive on the U.S. economy and the markets. There may be near-term volatility due to labor strikes, geopolitical conflict and the upcoming election.

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