Jobs report reveals cooling labor market and ‘uneven economy,’ analyst says

Amna Nawaz: Welcome to the "News Hour." The U.S. labor market is showing further signs of cooling, as the latest jobs report shows unemployment rising to 4.6 percent. That's the highest level in the last four years. There was some good news, as payrolls climbed by 64,000 new jobs last month, better than forecast, but the report also showed a net loss of 105,000 jobs in October. That marks the third time that the economy has shed jobs in the last six months. Geoff Bennett: And the biggest losses have been felt at the federal level amid mass firings affecting nearly 168,000 positions over the last two months. The delayed report was due to the six-week government shutdown. For analysis, we're joined now by David Wessel, director at the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution. Thanks for coming in. David Wessel, Brookings Institution: Good to see you. Geoff Bennett: So the unemployment rate, as Amna said, is now at 4.6 percent. Is that a meaningful sign of labor market weakening or is this just normal volatility? David Wessel: I think it's a meaningful sign that the labor market is weakening. There's more than the usual uncertainty this time. I know people are always saying one month doesn't matter, because the government couldn't do the usual collecting of data, surveying people during the shutdown, the government shutdown. But we started the year with unemployment at 4 percent, and now it's at 4.6. So that's a sign that the labor market is weakening. Geoff Bennett: And you pointed our team to this chart that shows the unemployment rate over the last three years rising steadily. So, in 2023, it was at 3.4 percent as the economy recovered from the pandemic, then was steady at 4.1 in late 2024. Now it's climbed back to levels we haven't seen since 2021. So how do those rates compare in terms of job quality, labor force participation, underemployment? David Wessel: Well, we know that labor force participation was up a little bit in the last report. We know also, interestingly, that there's a growing number of people who are working part-time who say that they would prefer full-time work. Now that number might be a little messed up by the federal employees. Some of them may have not worked a full week. So, when you look at all the numbers, the readiness of people to quit their jobs has fallen a lot. That's a sign that they're worried about finding jobs. It all points to a labor market that's weakening, but not falling apart. Geoff Bennett: We're also seeing job gains in health care, but losses in manufacturing and transportation. So what does that mix say about the economy and President Trump's stated desire to rebuild domestic manufacturing? David Wessel: Well, in the good news department, we did see that private sector employment was steady. And it's actually increased, the pace has increased a little bit since the summer. Manufacturing, as...

Preview: ~500 words