November 8, 2013
Statement From LIA Chief Economist John Rizzo on October Job Growth
By: Dr. John A. Rizzo
The addition of 204,000 jobs in October was substantially above expectations of 125,000. Moreover, the number of hires in August and September was revised upward by 60,000. While the unemployment rate ticked up slightly to 7.3%, this likely reflects the fact that furloughed Federal Government employees were counted as unemployed. The good news is that private sector hiring was robust in October, despite the shutdown. The strong jobs performance has raised expectations that the Fed may taper off its purchases of Treasury securities and mortgage-backed bonds when it convenes in mid-December, however. This would be unwise in my view. The economic recovery is still fragile while inflation is nowhere in sight. In such an environment, it would make better sense to continue to stimulate the economy until longer term evidence of solid recovery has been observed.