The U.S. Bureau of Labor Statistics will release the non-farm payroll report before the 2024 election, with data expected to be affected by hurricanes and worker strikes, potentially leading to a decrease of 60,000 to 100,000 in new non-farm employment. Economists predict an addition of 113,000 non-farm jobs in October, with the unemployment rate remaining at 4.1%. Despite challenges, the economy continues to show resilience, with consumer spending supporting economic growth
With only four days left until the 2024 U.S. election, the U.S. Bureau of Labor Statistics will release the latest non-farm payroll report. In this election, voters' perceptions of the economy play a crucial role.
However, this non-farm report may contain the most distorted data in years. Due to the impacts of hurricanes and worker strikes, U.S. job growth in October was temporarily suppressed. Just as voters, politicians, and Federal Reserve officials hoped for a clearer understanding of the economy, they will instead receive ambiguous data.
Trump and his supporters have repeatedly accused the Biden-Harris administration of causing the high inflation that peaked two years ago. Despite strong job growth, fewer layoffs, and a low unemployment rate, Trump still claims that America is a "failed country" and vows to impose comprehensive tariffs on all imported goods to restore millions of manufacturing jobs.
Typically, the non-farm payroll report helps clarify the economic situation. However, economists estimate that the ongoing impacts of Hurricane Helen, Milton, and the Boeing machinists' strike may reduce last month's non-farm job additions by about 60,000 to 100,000, most of which are temporary impacts.
Overall, economists estimate that Friday's report will show only 113,000 new non-farm jobs in October. While this number is decent, it is less than half of September's unexpectedly strong increase of 254,000, and the unemployment rate is expected to remain low at 4.1%. After accounting for the impacts of hurricanes and strikes, this data still indicates a robust job market, with healthy consumer spending providing strong support for the economy amid high interest rates.
"This is a highly resilient economy," said Jane Oates, a former Labor Department official during the Obama administration. "People are spending, and that is the strength supporting the economy."
However, the government may find it difficult to measure some other impacts. For example, the Labor Department believes that the Boeing machinists' strike and some small-scale strikes by hotel workers reduced October's job growth by 41,000. However, since the strike affected Boeing's sales, some of its suppliers may have also cut jobs. The impact of these layoffs on October's employment data remains unclear.
At the same time, the unemployment caused by hurricanes may be less than economists expect. A worker must go without pay for an entire pay period (usually two weeks) to be considered unemployed in government data. Oates noted that while many workers in North Carolina may indeed have been unemployed for that long, Florida has more experience dealing with hurricanes, and employees may not be absent for such a long time due to the hurricane.
UBS economists pointed out that several major theme parks in Orlando—Disneyland, SeaWorld, and Universal Studios—were only closed for two days after Hurricane Milton hit. In some states, people will be hired for cleanup and rebuilding work.
Friday's non-farm payroll report will be the last important economic data before the Federal Reserve's November meeting, and only four days before election day. Most economists expect the Federal Reserve to cut rates again by 25 basis points after a significant cut of 50 basis points in September. **
If the employment report indicates that job growth in October remains healthy after accounting for the impacts of hurricanes and strikes, Republican politicians may once again question its credibility. Last month, when the government reported an unexpected increase in September's employment, Republican Senator Marco Rubio from Florida accused the report of being "fabricated."
However, mainstream economists do not share this skeptical attitude, as other indicators such as initial jobless claims also suggest that the labor market remains robust.
"I am shocked that politicians are pushing this narrative so forcefully," said Julia Pollak, chief economist at ZipRecruiter. She believes that the Bureau of Labor Statistics, which releases the non-farm payroll report, "is the most transparent government agency in the world."
Trump and his critics seized on the revisions to the preliminary non-farm payroll estimates, claiming that the Biden-Harris administration manipulated the data. In August, the Bureau of Labor Statistics announced that it expected to revise the total U.S. employment number for March down by 818,000, about 0.5% of the total. During the presidential debate in September, Trump claimed that this revision reflected "fraud" in the employment data. However, during his own administration, the Bureau of Labor Statistics also revised employment numbers down by 514,000 in 2019.
Erica Groshen, a senior economic advisor at Cornell University and former head of the Bureau of Labor Statistics, explained that such revisions "are not a flaw but a feature," reflecting the government's data collection mechanisms. "The Bureau of Labor Statistics wants to release information as timely as possible, but also wants the data to be as accurate as possible," Groshen said. To this end, the Bureau of Labor Statistics releases early data based on surveys of tens of thousands of businesses, and then revises it based on actual employment data from more companies and unemployment insurance agencies.
Trump's campaign partner, Senator JD Vance, often claims that all new jobs created over the past year have gone to immigrants, using this to question the employment data. This assertion is based on the Bureau of Labor Statistics' "foreign-born" group, which increased by 1.2 million in September compared to last year, while the number of employed native-born workers decreased by about 800,000. However, the "foreign-born" category includes individuals who have lived in the U.S. since childhood and have become citizens, as well as recent legal and illegal immigrants.
More importantly, a large number of native-born Americans are retiring, which is one of the reasons many employers often struggle to fill positions. As a significant portion of the baby boomer generation ages, the share of the U.S. population aged 65 and older has risen from 13.1% in 2010 to 17.3%. Moreover, the unemployment rate for native-born Americans is 3.8%, which is actually lower than the unemployment rate for foreign-born workers at 4.2%