ROSELAND, N.J. (10/31/13)--The first October jobs numbers, released yesterday, indicate that the dysfunction in Washington has had a significant short-term effect on the labor market.
Employers added 130,000 workers this month, according to the New Jersey-based ADP Research Institute. But the figure is at a half-year minimum--lower than economists thought it would be, with analysts saying that the shutdown slowed job growth in October by almost 25%.
A median forecast of 39 economists polled by Bloomberg predicted that there would be an additional 150,000 jobs this month (Bloomberg.com, Oct 30). Moody's said that the shutdown slowed private sector job growth in October by about 30,000 (Moody's Economy.com, Oct. 30).
Moody's did note that job growth is expected to be higher in November, with federal employees receiving back pay and the holiday shopping season starting. Federal Reserve officials, who met Tuesday and Wednesday, also extended stimulus programs in light of the congressional gridlock. (See related News Now story, CUNA On Fed Decision: Margin Compression To Continue To Mid-2014, in today's issue.)
Of the additional 130,000 jobs, service industries accounted for 107,000; trade, transportation and utilities represented 40,000; manufacturers, builders and other goods-producing industries made up 24,000; and business and professional services jobs added another 20,000 to payrolls.
Moody's pointed out that service job gains were down by 23,000 in October and that business and professional services employment--a sector that includes government contractors--was repeatedly adding more than 40,000 jobs per month earlier in the year.
Among other sectors that saw employment shrink, the financial sector--banks, insurance companies, real estate and leasing--shed 5,000 jobs this month, the largest drop since February 2011.