Utah added about 38,200 new jobs in the 12-month period between October 2022 and October 2023, a 2.2% year-over-year increase.
The unemployment rate, adjusted for seasonal variations, remained near historic lows at just 2.7%, but it was rising, having gone up a tenth of a percentage point from the previous month, according to figures reported by the Utah Department of Workforce Services.
“Over the past few months, job growth rates in Utah have maintained around the 2% range,” said Mark Knold, Chief Economist at the DWS. “While slightly below the state’s long-term average, it’s remarkable that this deceleration in job growth has only recently occurred — especially considering the record low unemployment of the past year.”
Utah still outpaced most other states for job growth, and the unemployment rate was still much lower than the national average of 3.9%.
The private sector counted a 2.1% year-over-year increase in jobs, led by big jumps in the Leisure and Hospitality Services industry sector (11,500 new jobs) and in education and health services (8,700). There were two sectors that counted job losses, with 1,000 fewer jobs reported in trade, transportation and utilities and 1,000 fewer jobs in manufacturing.
More in-depth analyses and data tables are available at https://jobs.utah.gov/wi/update/index.html.
National hiring trends
The auto workers strike also dampened employment gains last month as manufacturing lost 35,000 jobs.
The unemployment rate rose from 3.8% to 3.9%, the Labor Department said Friday, the highest level since January 2022.
Economists surveyed by Bloomberg had estimated that 180,000 jobs were added last month.
Another possible sign of a weakening labor market: Job gains for August and September were revised down by a combined 101,000, depicting a less robust picture of hiring in late summer than previously thought.
Are US wages increasing?
Average hourly earnings rose 7 cents to $34, nudging down the yearly increase to 4.1% from 4.2%. That should be welcomed by a Federal Reserve seeking to tamp down pay increases that are feeding into inflation. Fed officials would like to see wage growth ease to 3.5% to align with their 2% overall inflation goal. Wage growth topped 5% last year amid severe COVID-related labor shortages.
How is the Dow reacting?
Investors cheered the report on the hope that milder pay increases and a cooling job market would allow the Fed to continue to hold its key interest rate steady after hiking it aggressively from March 2022 to July 2023.
The Dow Jones industrial average rose 222.24 points, or 0.7%, to end at 34,061 on Friday while the S&P 500 index jumped 0.9% to finish at 4,358.
Which industries need workers the most?
Besides the strike-related job losses in manufacturing, hiring was subdued across a broad range of industries, with the private sector adding just 99,000 jobs. Health care led the payroll gains with 58,000. Construction added 23,000; leisure and hospitality, 19,000; and professional and business services, 15,000.
Transportation and warehousing, information and financial activities all shed jobs,
Total job gains were pushed up to a more solid figure by 51,000 gains in federal, state and local governments, whose tallies are often volatile and don’t necessarily reflect the health of the economy.
Is the US job market slowing down?
The job market was expected to be impacted by several one-time factors in October. The United Auto Workers strike was set to reduce employment by about 30,000 workers, Goldman Sachs said before the report was released. Yet the tentative resolution of the walkout should mean a similar bump in employment for November, the research firm said.
Although the Federal Reserve’s aggressive interest rate hikes and inflation have had some impact, the worker shortages have made employers reluctant to lay off staffers and kept average yearly wage growth above 4%, fueling consumption.
Forecasters expect economic activity, job gains and pay increases to slow more dramatically next year as higher borrowing costs further squeeze households and businesses, and more Americans deplete their pandemic-related savings. Nearly half of economists are still predicting a mild recession within the next 12 months.
Contributing: USA TODAY.