US employers add 165,000 jobs in October as unemployment dips to 4.1%

Average pay rose 3.1% over the year while inflation ran at 3.7%

U.S. employers added 165,000 jobs in October, and the unemployment rate slipped to 4.1%, according to the Labor Department’s monthly jobs report released Friday.

The department also revised up its estimates of hiring for August and September by a combined 84,000 jobs, adding to the month’s picture of a labor market picking up steam.

Health care, manufacturing and business services added jobs during the month, while restaurants and construction companies cut them.

The 4.1% October rate followed a September reading of 4.2% — the most recent value listed in FRED, the St. Louis Fed’s Federal Reserve Economic Data database, as of Friday, Nov. 6.

Average wages in October were up 3.1% from a year earlier — a bigger annual increase than the previous month’s, though probably still not enough to keep pace with rising prices.

Inflation climbed to 3.7% in September, and the cost of living has been going up faster than wages for much of this year, since the war with Iran triggered a sharp jump in energy prices.

“Workers are losing ground right now,” said Cory Stahle, an economist with the job-search website Indeed.

“The longer it wears on, the more and more they’re going to feel that,” Stahle said.

Voters’ frustration with high prices was a big factor in the midterm elections, which cost Republicans their majorities in both the House and Senate.

The unemployment rate remains historically low, which has allowed the Federal Reserve to focus its attention on fighting inflation. The central bank held its benchmark interest rate steady last week, but investors expect policymakers to raise rates when they meet in December.