U.S. labor market tightens, but wages still anemic

Fri Nov 7, 2014 2:14pm EST
 
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By Lucia Mutikani

WASHINGTON (Reuters) - U.S. job growth increased at a steady clip in October and the unemployment rate fell to a fresh six-year low, underscoring the economy's resilience in the face of slowing global demand.

Despite the strengthening labor market, wage growth remained tepid, suggesting little need for the Federal Reserve to hurry to start lifting interest rates.

Employers added 214,000 new jobs to their payrolls last month, the Labor Department said on Friday. The unemployment rate fell to 5.8 percent from 5.9 percent, even as more people entered the labor force - a further sign of strength.

"The report confirms that the U.S. remains the bright spot in a global economic picture filling with clouds," said Michael Griffin, managing director at CEB in Arlington, Virginia.

The jobless rate has dropped by 0.8 percentage point since January, and employment gains have now topped 200,000 for nine straight months, the longest stretch since 1994.

Last month's increase was a bit smaller than economists on Wall Street had expected, but that was offset by a combined 31,000 upward revision to data for August and September.

In addition, the hiring was broad-based and most of the measures Fed Chair Janet Yellen tracks to gauge the amount of slack in the labor market improved.

The U.S. central bank last week struck a relatively upbeat tune on the jobs picture as it ended a bond-buying stimulus program, but even after the employment data, financial markets held to their view that benchmark rates would stay near zero until the second half of 2015.   Continued...

 
Jobseekers wait to talk to a recruiter (L) at the Colorado Hospital Association's health care career event in Denver October 13, 2014. Hundreds of applicants met with several health care providers with current job openings during the event. REUTERS/Rick Wilking