- Payrolls in U.S. Rise by 161,000 in October as Wages Accelerate
U.S. jobs continued to rise at a steady pace in October and wage gains accelerated, signs that the labor market and economy made steady progress at the start of the fourth quarter.
Payrolls climbed by 161,000 last month following a 191,000 gain in September that was larger than previously estimated, a Labor Department report showed Friday. The median forecast called for 173,000. The jobless rate fell to 4.9 percent, while wages rose from a year earlier by the most since June 2009.
The figures are likely to keep the Federal Reserve on track to raise borrowing costs next month for the first time in 2016. Underlying the steady gains in employment is a balance between hiring managers’ need to keep up with stable domestic demand and the struggle to match more limited labor to skilled-job vacancies.
“The pace of job growth remains pretty steady,” said Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit, who had projected payrolls at 165,000. “We’re starting to see wages pick up a little. The report supports the idea that the opportunity is there for the Fed to raise rates, and it’s certainly appropriate for them do so” in December.
Workers have been in short supply for 13 straight months, according to the Institute for Supply Management survey of service-industry companies, which make up almost 90 percent of the economy.
The median forecast in a Bloomberg survey called for a 173,000 advance in payrolls. Estimates in the Bloomberg survey ranged from gains of 105,000 to 208,000 after a previously reported 156,000 September increase.
Revisions added a total of 44,000 jobs to payrolls in the previous two months.
The unemployment rate, which is derived from a separate Labor Department survey of households, dropped from 5 percent the prior month, returning to its level from August.
While economists and policy makers largely agree that the U.S. economy is close to full employment, blemishes remain, with the ranks of part-time workers and long-term jobless still higher than before the last recession.
The labor force participation rate, which indicates the share of working-age people who are employed or looking for work, slipped to 62.8 percent from 62.9 percent, as the number of people in the labor force declined.
The government’s underemployment rate dropped to 9.5 percent in October from 9.7 percent, while the number of people working part-time for economic reasons was little changed, according to Friday’s report. Some 5.89 million American employees were in part-time jobs but wanted full-time work.
Wage gains picked up, with average hourly earnings rising 0.4 percent from a month earlier to $25.92. The year-over-year increase was 2.8 percent, compared with 2.7 percent in the year ended in September.
The average work week for all workers was unchanged at 34.4 hours in October.
Among service providers, education and health services led with an increase of 52,000 jobs, followed by professional and business services at 43,000. Retailers pared payrolls by 1,100 on declines at electronics and appliance stores and clothing shops.
Factories reduced payrolls by 9,000 after an 8,000 decline the month before, in line with a report earlier this week that showed manufacturing barely expanded in October while orders moderated. Employment at construction companies rose by 11,000.
Governments added 19,000 workers.
Friday’s figures showed 238,000 Americans weren’t at work because of weather during the survey week, even though they were counted as employed in the household survey, the agency said. Bad weather can affect the payroll count if employees didn’t receive compensation for the entire pay period that included the 12th of the month.
Hurricane Matthew’s assault on the East Coast was just fading at the start of the week with the 12th. The storm moved up the Florida coastline on Oct. 7 before making landfall in South Carolina the following day and continuing on to North Carolina, causing flooding and power outages along the way.
The labor-market figures offer a last big hint at the direction of the economy before Americans flock to the polls Nov. 8.
Figures released last week on the third-quarter pace of growth offered a mixed picture. While gross domestic product increased at a 2.9 percent annualized rate for the strongest pace in two years, inventory rebuilding and a soybean-related jump in exports largely fueled the rebound. Consumer spending slowed more than expected.
Fed policy makers who concluded a two-day meeting Wednesday in Washington offered an assessment of the economy that was broadly similar to their September statement, reinforcing the consensus view that they will raise the benchmark interest rate in December for the first time this year.
The central bankers reiterated that the “labor market has continued to strengthen and growth of economic activity has picked up” since the first half of 2016. Even so, they opted to wait for “some further evidence” of progress before increasing borrowing costs.
Communities in Delta State Shut OML30 Operates by Heritage Energy Operational Services Ltd
The OML30 operated by Heritage Energy Operational Services Limited in Delta State has been shut down by the host communities for failing to meet its obligations to the 112 host communities.
The host communities, led by its Management Committee/President Generals, had accused the company of gross indifference and failure in its obligations to the host communities despite several meetings and calls to ensure a peaceful resolution.
The station with a production capacity of 80,000 barrels per day and eight flow stations operates within the Ughelli area of Delta State.
The host communities specifically accused HEOSL of failure to pay the GMOU fund for the last two years despite mediation by the Delta State Government on May 18, 2020.
Also, the host communities accused HEOSL of ‘total stoppage of scholarship award and payment to host communities since 2016’.
The Chairman, Dr Harrison Oboghor and Secretary, Mr Ibuje Joseph that led the OML30 host communities explained to journalists on Monday that the host communities had resolved not to backpedal until all their demands were met.
Crude Oil Recovers from 4 Percent Decline as Joe Biden Wins
Oil Prices Recover from 4 Percent Decline as Joe Biden Wins
Crude oil prices rose with other financial markets on Monday following a 4 percent decline on Friday.
This was after Joe Biden, the former Vice-President and now the President-elect won the race to the White House.
Global benchmark oil, Brent crude oil, gained $1.06 or 2.7 percent to $40.51 per barrel on Monday while the U.S West Texas Intermediate crude oil gained $1.07 or 2.9 percent to $38.21 per barrel.
On Friday, Brent crude oil declined by 4 percent as global uncertainty surged amid unclear US election and a series of negative comments from President Trump. However, on Saturday when it became clear that Joe Biden has won, global financial markets rebounded in anticipation of additional stimulus given Biden’s position on economic growth and recovery.
“Trading this morning has a risk-on flavor, reflecting increasing confidence that Joe Biden will occupy the White House, but the Republican Party will retain control of the Senate,” Michael McCarthy, chief market strategist at CMC Markets in Sydney.
“The outcome is ideal from a market point of view. Neither party controls the Congress, so both trade wars and higher taxes are largely off the agenda.”
The president-elect and his team are now working on mitigating the risk of COVID-19, grow the world’s largest economy by protecting small businesses and the middle class that is the backbone of the American economy.
“There will be some repercussions further down the road,” said OCBC’s economist Howie Lee, raising the possibility of lockdowns in the United States under Biden.
“Either you’re crimping energy demand or consumption behavior.”
Nigeria, Other OPEC Members Oil Revenue to Hit 18 Year Low in 2020
Revenue of OPEC Members to Drop to 18 Year Low in 2020
The United States Energy Information Administration (EIA) has predicted that the oil revenue of members of the Organisation of the Petroleum Exporting Countries (OPEC) will decline to 18-year low in 2020.
EIA said their combined oil export revenue will plunge to its lowest level since 2002. It proceeded to put a value to the projection by saying members of the oil cartel would earn around $323 billion in net oil export in 2020.
“If realised, this forecast revenue would be the lowest in 18 years. Lower crude oil prices and lower export volumes drive this expected decrease in export revenues,” it said.
The oil expert based its projection on weak global oil demand and low oil prices because of COVID-19.
It said this coupled with production cuts by OPEC members in recent months will impact net revenue of the cartel in 2020.
It said, “OPEC earned an estimated $595bn in net oil export revenues in 2019, less than half of the estimated record high of $1.2tn, which was earned in 2012.
“Continued declines in revenue in 2020 could be detrimental to member countries’ fiscal budgets, which rely heavily on revenues from oil sales to import goods, fund social programmes, and support public services.”
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