The U.S. labor market remains strong, with employers adding a whopping 336,000 jobs in September and unemployment holding at a near-record low — and economists expect Minnesota to show similar results for the month.
The data released Friday by the Bureau of Labor Statistics shows the largest gain in jobs since January.
But what may be good news for job seekers was startling for economists, who had predicted employers would add about half as many jobs last month. The Fed has already raised interest rates to the highest level in more than 20 years in an effort to calm price and wage gains, and is expected to continue to do so.
"The Fed is trying to pull off this soft landing where they take some of the heat out of the economy and settle into a very healthy and stable economy where everyone has a productive place in it," said Aaron Sojourner, a labor economist at the W.E. Upjohn Institute for Employment Research. "There's a risk there that they hold rates too high, too long."
Erick Garcia Luna, regional outreach director at the Minneapolis Fed, said steps the central bank has taken have already had a positive effect on inflation, which has dropped from a high of about 9% to 3.7%.
"If the labor market remains resilient as we work toward reaching our 2% inflation target rate, I think that is a good thing," he said. "The other thing is we do not only look at one particular data point. We have to look at a variety of indicators."
Even though the top-line job growth number is surprising, Sojourner said, there are other pieces of the September report that indicate stability, including labor force participation, unemployment and average hours worked. The report also showed slowing wage growth.
In Minnesota, which tends to mirror the national economy, the picture is likely to be similar, he said.