U.S. Jobs Rise by 165,000 in October; Odds of Rate Hike Reach 77%
Key Facts
U.S. nonfarm payrolls rose by 165,000 jobs in October 2026, exceeding the average monthly increase of 48,000 over the previous twelve months, according to the U.S. Bureau of Labor Statistics. The report was released on November 6, and market data showed the probability of the Federal Reserve raising interest rates at its next meeting in December reached 77% after its release. The Associated Press said that probability had risen about 10 percentage points from Thursday. The bureau also said the unemployment rate changed little in October, after standing at 4.2% in September. The report thus combined faster employment growth compared with the previous year's average with increased investor bets on a rate hike.
The job gains were spread across several sectors, led by professional and business services, which added 70,000 jobs in October, according to bureau data. Health care added 42,000 jobs, while employment in transportation and warehousing rose by 25,000. These sector gains were part of the total increase of 165,000 jobs. The month's total was above the average monthly increase of 48,000 jobs recorded over the previous twelve months. The sector details show the sources of employment growth in the report alongside the overall figure that the data lifted.
Average hourly earnings for private-sector nonfarm employees rose 14 cents, or 0.4%, to $38.00 in October, according to the Bureau of Labor Statistics. In the twelve months through October, average hourly earnings increased 3.1%. Wage growth coincided with an increase in jobs, while the change in the unemployment rate remained limited, as the bureau described it. The report therefore measures not only the number of new jobs, but also includes data on wages and labor-force participation. The number of people in the labor force rose by 421,000 in October, while the participation rate remained at 61.9%.
The bureau revised its estimates for the previous two months higher, raising August job growth by 53,000, from 133,000 to 186,000, and lifting its estimate for September by 31,000, from 29,000 to 60,000. The gains for the two months were therefore 84,000 jobs higher in total than previously estimated. The September report had recorded an increase of 29,000 jobs, an unemployment rate of 4.2%, and an average monthly increase of 45,000 over the twelve months preceding that report. October's reading of 165,000 exceeded the average of 48,000 over the previous twelve months. The revisions add to the picture of employment in recent months, raising the estimated level of gains for August and September alongside the new reading.
The jobs reading was reflected in market pricing for the rate path. The Associated Press cited CME Group's FedWatch tool as showing the probability of a December rate hike had reached 77%, up about 10 percentage points from Thursday. That put market bets after the report at a higher level than they had been a day earlier, according to the comparison in the report. The move came as Bureau of Labor Statistics data showed employment exceeded its monthly average for the year and wages rose 3.1% in the twelve months through October. The open source did not give a figure for economists' prior jobs forecast, but said employment exceeded their expectations. The probability cited in the Associated Press report remains a reading of market pricing after the data.
The Federal Reserve's schedule for November 9 includes a discussion on supervision and regulation by Vice Chair for Supervision Michelle Bowman, and on November 10, a speech by Governor Christopher Waller and two discussions by Bowman, according to the central bank's calendar. These appearances set out later dates on the week's schedule as investors watch the rate path ahead of the December meeting. The next official labor-market data concern the November jobs report, scheduled for release on December 4, 2026, at 8:30 a.m. Eastern time, according to the Bureau of Labor Statistics. The release will follow October's reading, which showed an addition of 165,000 jobs. It will also follow revisions that raised the estimates for August and September by a combined 84,000 jobs.