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US jobs growth exceeds expectations despite trade wars and global slowdown

Monthly employment data showed the workforce increased by 128,000 in October, well above the forecast 89,000.

Worker
Image: The economy also created 95,000 more jobs in August and September than previously estimated
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Solid jobs figures in the US indicate its economic health is holding up despite being hampered by trade wars and the global slowdown.

Monthly employment data showed the workforce increased by 128,000 in October, well above the forecast 89,000.

This figure was also held down by a now-resolved strike at General Motors that saw tens of thousands of workers temporarily counted as unemployed.

The economy also created 95,000 more jobs in August and September than previously estimated, suggesting a healthier employment market than initially believed.

FLINT, MI - OCTOBER 23: United Auto Workers union members picket at the General Motors Flint Assembly plant for the sixth week of their national strike against General Motors on October 23, 2019 in Flint, Michigan. UAW members are voting on a tentative agreement this week and the results will be announced this Friday. The strike is the longest UAW national strike since 1970. (Photo by Bill Pugliano/Getty Images)
Image: The jobs figures were held down by a now-resolved strike at General Motors

The unemployment rate remained almost unchanged, rising from 3.5% to 3.6% and still near a five-decade low.

For the second month in a row, average hourly wages rose by 3% from a year ago.

The better than expected jobs data will make it even less likely that the Federal Reserve, which cut interest rates this week for a third time this year, will do so again in the near future.

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Last month, the GM strike contributed to the temporary loss of 41,600 jobs in the motor industry.

But the settlement of the dispute seems sure to see a return of those jobs to the payroll numbers in the coming months.

Another temporary drag on hiring last month was the US census, with the government letting go of 20,000 short-term workers who had been helping prepare for the 2020 survey.

Job growth so far this year has averaged just 167,000 a month, down from an average of 223,000 in 2018, according to official figures.

On Wednesday, the government estimated that the economy grew in the July-October quarter at a modest annual rate of 1.9%.

The US economy has been expanding for more than a decade, the longest period of growth on record.

But the shot in the arm from the 2018 tax cuts are fading and an ageing population and other demographic changes are hindering growth.

Surveys also suggest employers have become more cautious, mainly because of uncertainty caused by Donald Trump's trade wars.

The US president has imposed tariffs on many imported goods and other nations have retaliated with import taxes on US exports.

One result is that companies, especially in manufacturing, have slowed or stopped taking on new workers.

At the same time, businesses have slashed their spending on industrial machinery and other equipment, mostly because the trade conflict with China has made them reluctant to make large investments.

The tariffs between the US and China, the world's two largest economies, have also reduced US exports.