Employers add 165,000 jobs as unemployment dips to 4.1 percent

What changed since chapter twenty-three

The Employment Situation for October, published Friday 6 November, showed employers added 165,000 jobs, after the ten-year Treasury yield fell from 4.98 percent on 29 October to 4.84 on Thursday. ^{[6, 1]}

The unemployment rate was 4.1 percent, against 4.2 in September, and average hourly earnings rose 14 cents to $38.00, 3.1 percent above a year earlier. August was revised up to 186,000 jobs and September to 60,000, together 84,000 more than first reported. ^{[6, 17]}

Health care added 42,000 jobs and professional and business services 70,000, the bureau said, with transportation and warehousing also up. Labor force participation rose to 61.9 percent from 61.8. ^{[6, 16, 17]}

The record

On the Treasury's par yield curve the ten-year ended Monday 2 November at 4.91 percent, Tuesday at 4.95, Wednesday at 4.90 and Thursday at 4.84, against 4.94 on Friday 30 October. The two-year ended those days at 4.59, 4.61, 4.58 and 4.46, the thirty-year at 5.28, 5.32, 5.28 and 5.25. ^[1]

Thursday's move was widest at the short end, by the desk's arithmetic: the two-year was down 12 basis points, hundredths of a percentage point, the ten-year 6 and the thirty-year 3. Every yield on Thursday's table, from 4.03 percent at one month, stands above the top of the Fed's range. ^{[1, 2]}

The Federal Open Market Committee kept that range at 3-3/4 to 4 percent on Wednesday 28 October by a 10 to 2 vote; Lisa D. Cook and Beth M. Hammack preferred a quarter-point increase. ^[2]

On Friday 30 October, as the blackout on comment ended, Dallas Fed president Lorie Logan said in a prepared speech that the committee needs 'at least two more 25-basis-point rate increases', Reuters reported. St. Louis Fed president Alberto Musalem said 'firming of monetary policy will be necessary, and soon', and Richmond Fed president Thomas Barkin said 'the direction of travel is pretty straightforward'. ^[3]

On Wednesday 4 November the Treasury said it will sell $125 billion of securities to refund about $97 billion of maturing notes and bonds. The sales are $58 billion of three-year notes on Monday 9 November, $42 billion of ten-year notes on Tuesday 10 November and $25 billion of thirty-year bonds on Thursday 12 November. The statement says the Treasury anticipates keeping these sizes 'for the next several quarters'. ^{[4, 5]}

Freddie Mac's survey put the 30-year fixed mortgage at 7.18 percent on Thursday 5 November, against 7.24 a week earlier and 6.22 a year earlier, its third straight weekly decline. New claims for unemployment benefits were 189,000 in the week ending 31 October, 6,000 fewer than the week before, the Labor Department said. ^{[13, 12, 8]}

Who it reaches

D.R. Horton (DHI), Lennar (LEN), PulteGroup (PHM), Toll Brothers (TOL) and KB Home (KBH) are adjacent as builders whose buyers borrow at the mortgage rates in Freddie Mac's survey. Rocket Companies (RKT) and UWM Holdings (UWMC) are adjacent as lenders whose volume follows them. ^[13]

JPMorgan Chase (JPM), Bank of America (BAC), Wells Fargo (WFC) and U.S. Bancorp (USB) are adjacent as banks whose lending margin the Treasury curve sets. AGNC Investment (AGNC) and Annaly Capital (NLY) are adjacent as mortgage trusts whose holdings are priced off it. ^[1]

October's table shows construction down 3,000 jobs and financial activities up 7,000, both of which the bureau called little changed. Those two lines reach the builders and the banks directly. ^{[6, 16]}

Where the sources disagree

On what was expected. NBC News reported a Dow Jones survey at 59,000 jobs and pay 2.9 percent higher than a year earlier; Reuters, a Bloomberg survey and FactSet each had 65,000. ^{[9, 7, 10, 11]}

Reuters wrote on Friday 30 October that futures had eased back on a December increase but still favored one. Morningstar reported a 79 percent chance of an increase on Wednesday 4 November, up from about 70 percent a week earlier. ^{[3, 11]}

The bureau's 165,000 ran far above all of those surveys, and unemployment came in at 4.1 percent, a tenth below the 4.2 they shared. ^{[6, 9, 7, 10]}

What settles it next

The Treasury publishes Friday's table in the evening, then the auctions follow on 9, 10 and 12 November. Freddie Mac's survey is released weekly on Thursdays at noon. ^{[1, 4, 13]}

The Bureau of Economic Analysis publishes GDP (Second Estimate) and Personal Income and Outlays, October 2026 on Wednesday 25 November at 8:30. The Fed's committee meets on Tuesday 8 and Wednesday 9 December, with a Summary of Economic Projections. ^{[15, 14]}