Payrolls in the U.S. increased more than forecast in October, a sign that employers were optimistic the world’s biggest economy would weather the effects of the federal government shutdown.
The addition of 204,000 workers followed a revised 163,000 gain in September that was larger than initially estimated, Labor Department figures showed today in Washington. The median forecast of 91 economists surveyed by Bloomberg called for a 120,000 advance. The jobless rate rose to 7.3 percent from an almost five-year low.
The figures indicate companies adhered to hiring plans with an outlook to stronger sales in the aftermath of the 16-day budget impasse and a debate over raising the nation’s debt ceiling. The data also underscore the view of Federal Reserve officials that employment conditions are on the mend as they look beyond fiscal restraint in considering when to dial back record monetary stimulus.
“The economy isn’t as weak as people seem to think it is in the fourth quarter,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, said before the report. “The job market is in a phase of grinding improvement.”
Stock-index futures declined as the report fueled speculation the Fed is closer to reducing stimulus. The contract on the Standard & Poor’s 500 Index expiring in December dropped 0.2 percent to 1,741.3 at 8:36 a.m. in New York.