Jobs, jobs, jobs!
If President Trump is consistent about anything, it is that creating more jobs for more Americans will help "Make America Great Again." In August, following "excellent jobs numbers," the president tweeted that he has "only just begun" bringing jobs back to the U.S. as "regulations continue to fall;" but the labor market may be getting close to full employment.
"If [the notion that the labor market is at full employment] is correct, the job market will overheat unless growth slows to a trend pace soon," Jan Hatzius, the chief economist at Goldman Sachs, wrote in an October research note, prior to the release of the October jobs report. "So far, we see no signs of such a slowdown in the data."
The U.S. economy added 261,000 jobs in October, missing estimates of 310,000 from FactSet and the consensus estimate of 325,000 from Bloomberg. The unemployment rate was 4.1%, slightly lower than expectations of 4.2%.
Robert Lerman, an economist and fellow at the Urban Institute, said in an interview with TheStreet on Thursday that employment levels vary by state.
"I do think that in many labor markets jobs are plentiful; we might not be back to the full utilization of the workforce, but we are close," Lerman said.
The labor force participation rate fell by 0.4 percentage points to 62.7% in October. This follows an uptick in September, when the labor force participation rate rose to 63.1%, even though hurricanes Harvey and Irma affected total nonfarm payroll employment. That number was a revised 18,000 in September, according to data from the Bureau of Labor Statistics (BLS). Analysts at JPMorgan called the September uptick a "positive sign."
Lerman said the labor force participation rate is fairly low and thinks that it will rise, "but it's far from certain."
"As long as the economy is continuing on the track we have today, it is likely to continue a little bit," said Lerman. He said that in 1997, the labor force participation rate of men, ages 25 to 54, was about 92%, compared with about 88.5% today, so there is room for participation growth.
"Labor force participation has fallen to 62.7% a couple of other times over the past year, but has always rebounded thereafter," Royce Mendes, a senior economist at CIBC World Markets, wrote in a research note on Friday."Given that discouraged workers are still being pulled back into the workforce, we expect the participation rate to rise slightly in the months ahead, taking the unemployment rate with it."
The unemployment rate fell to 4.1% in October. Despite the fact that the unemployment rate "has returned to pre-recession levels, certain demographics, such as youth and people of color, still face extremely high levels of unemployment and underemployment," wrote Annie McGrew and Kate Bahn of the Center for American Progress, a nonpartisan policy institute.
One of the biggest challenges for labor market going forward is upgrading the skills and productivity or workers, Lerman said. "I think the outlook for foreign investment in the U.S. could be even better if we had a better system of training workers," he said.
Still, the total nonfarm payroll between the months of January and September is at the lowest level since 2010, according to BLS data. This year, nonfarm payroll employment stands at 1,424,000 through September. For the same period last year, nonfarm payrolls stood at 1,797,000. In the past decade, the nonfarm payroll between January and September reached its highest level in 2014 at about 2,204,000.
Lerman said that this "somewhat indicative of tightness in the labor market." A tight labor market indicates that there are more jobs than workers.
Employment numbers also generally increase around the holiday season as many large companies hire temporary workers, such as Amazon.com Inc. (AMZN) , Target Corp. (TGT) and the United Parcel Service (UPS) .
BMO Capital Markets analyst Jeffrey Silber said that temporary staffing volume increased by 4.1% year-over-year in October, accelerating from last month's 3.9% year-over-year increase.
TheStreet's feature series "Inside Trump's First Year" looks at the biggest stories in business over the last year fueled by one of the most unpredictable presidents in history. Most importantly, TheStreet offers a glimpse into what could happen in 2018 on a range of issues -- and stocks -- in what will probably be an equally chaotic second year for Trump. Read more by tapping the photo below.