Back on Track: As Delta Fades, the US Adds More Jobs

The U.S. economy beat expectations to add 531,000 jobs in October

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It was looking pretty grim there for a while, but as the latest wave of COVID-19 cases has receded, more people are getting back to work. 

The U.S. economy added 531,000 jobs in October, the most since July and more than the 450,000 economists had expected, according to monthly data released Friday by the Bureau of Labor Statistics. Not only that, but the total number of jobs added in August and September was actually 235,000 higher than originally reported, the bureau said.

Key Takeaways

  • The U.S. economy added 531,000 jobs in October, and the figures for previous months were revised up, improving the trajectory for the job market recovery. 
  • Every major private sector added jobs, while the number of government jobs declined.
  • Economists credited the receding pandemic, reopening of schools, and rising wages for the improvement.

The rebound in monthly job growth paints a far better picture than we had before Friday, when it looked like the labor market recovery had slowed to a crawl and September appeared to be the worst month so far this year. The decline in daily COVID-19 case counts helped the recovery pick up speed as restrictions were lifted and customers and employees alike felt safer going out in public again, economists said.

“It was a very good month,” said Robert Fry, a consultant and former chief economist of DuPont. “People have had less fear of going back to work.”

The new momentum helps set things back on track after the delta variant of the coronavirus contributed to a serious economic setback late this summer and the slowest quarterly growth in GDP since the recession last year. Still, the increase in October was half what it was in July and 4.2 million of the 22.4 million jobs lost at the start of the pandemic have yet to be recovered.

"It's getting better, although not as fast as we would like," said Michael Pugliese, an economist at Wells Fargo Securities. 

The gains were broad-based, with every major category other than government workers showing increases. The private sector added 604,000 jobs, led by a 164,000-job increase in the leisure and hospitality field, but the headline total was dragged down by the loss of 73,000 government jobs.

The threat of catching the contagious coronavirus helps explain why the U.S. has yet to return to pre-pandemic employment levels despite a near-record 10.4 million job openings in August and rapidly rising wages, Fry said. Another indication workers are in high demand: hourly earnings have grown 4.9% over the past year, according to Friday’s report.

Thankfully, though, the country’s overall daily case counts have dropped dramatically, and other factors have contributed too, economists said. The reopening of schools this fall requires fewer parents to provide child care rather than take up jobs, and the expiration of extra pandemic-related unemployment benefits between June and September means there’s less of a disincentive to returning to work, if that was a factor for some, Fry said.

The latest jobs data may also be an indication that the sharply slower reported growth in third-quarter gross domestic product was probably an underestimate that will be revised up, Fry said.

“America is getting back to work,” President Joe Biden said Friday after the bureau released its report. “Our economy is starting to work for more Americans.”

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Article Sources

  1. Bureau of Labor Statistics. “The Employment Situation—October 2021.” Accessed Nov. 5, 2021,

  2. Centers for Disease Control and Prevention. “CDC COVID Data Tracker.” Accessed Nov. 5, 2021.

  3. RBC Economics. “US Labour Market Recover Picked Up Steam In October.” Accessed Nov. 5, 2021.

  4. BMO. “US Payrolls in October: All Treats.” Accessed Nov. 5, 2021.

  5. CIBC. “US Labor Market Gains Ground in October.” Accessed Nov. 5, 2021.

  6. RBC Economics. “US Labour Market Recover Picked Up Steam In October.” Accessed Nov. 5, 2021.

  7. Bureau of Labor Statistics. “The Employment Situation - October 2021.” Page 7. Accessed Nov. 5, 2021.