The U.S. economy added 271,000 new jobs in October, and the unemployment rate fell to 5%, according to data released Friday morning by the Bureau of Labor Statistics.
The number was well above economists expectations of 182,000 new jobs, and revisions to previous months’ estimates show that the economy is supporting an additional 12,000 new jobs than previously thought.
Other bright spots in the report include the fact that the number of involuntary part-time workers fell by more than 250,000, while average hourly earnings surged 9 cents per hour, much faster than economists were expecting. Over the past year, average hourly earnings have risen 2.5%, keeping ahead of inflation.
With speeches from several Fed officials, including Chair Janet Yellen, suggesting a low bar for a December rate increase, economists say monthly job gains above 150,000 in October and November would be sufficient for the central bank to lift benchmark overnight borrowing costs from near zero.
Minutes from the Fed’s Oct. 27-28 meeting and subsequent comments from Yellen have firmly put a rate hike on the table at the central bank’s Dec. 15-16 policy meeting.
The employment report joined October’s strong services sector and auto sales data in supporting views that economic growth will regain momentum in the fourth quarter after braking sharply to a 1.5% annual pace in the July-September period.
—Reuters contributed to this report.