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Big Upside Jobs Revision

October's payroll growth is weaker than expected, but the prior two months are taken much higher.

Updated from 8:50 a.m. EST

The economy created fewer jobs than had been expected last month, but the number of workers added to payrolls in August and September was revised sharply higher.

According to the Labor Department's Bureau of Labor Statistics, 92,000 nonfarm jobs were formed in October, and the unemployment rate fell to 4.4% -- its lowest level since April 2001 -- from 4.6% the prior month.

Economists had been estimating that 125,000 new positions were created outside the farm sector and that the jobless rate would stay unchanged.

However, more startling than the 33,000-job shortfall from last month was the upward revision to the previous two reports. The government said Friday that in total, an additional 139,000 jobs were created in August and September than had been originally reported.

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Following the data, stock futures strengthened and bond prices fell, pushing up yields. The odds of the

Federal Reserve

cutting rates by January fell to 4% from the 16% chance being priced in on Thursday.

Job growth continued in several service-providing industries, whileemployment declined in manufacturing and construction last month, the BLS said. Average hourly earnings rose by 6 cents during October.

The manufacturing sector lost 39,000 jobs, and construction had a decrease of 26,000. Services jobs rose by 152,000, but a weak subset was retail trade, where 3,000 positions were lost.