With less than a week to go, voters saw a jobs report that was skewed by hurricanes and a strike at Boeing. This threw off the picture of the U.S. economy just as Kamala Harris and Donald Trump were getting ready to run against each other after one of the most nasty campaigns in recent memory.
The Trump team said the report was a “catastrophe” and showed how badly Harris, who is vice president now, has run the economy.
But the October report tells us more about the economy as a whole, and we need to think about that before Tuesday’s election.
According to BourseWatch, the rise in jobs was the smallest since December 2020. Why? There is a strike going on at Boeing BA and the impact of hurricanes Helene and Milton are making it hard to see how much the job market is cooling.
Because of these things, the report was a “head fake,” as Moody’s Analytics’ top economist Mark Zandi put it. He thinks the economy added about 150,000 jobs, which is about the same number as in the past few months.
In an X post, he said, “It’s safe to say the job market is still rock solid.”
Zandi’s firm has been looking at economic data and the election over a longer period of time. Their most recent report says that things like mortgage rates, which have gone down a lot since last year, and continued drops in gas prices are helping Harris’s chances of getting the White House.
The race for president between Trump and Harris is still very close in the states that will decide the election. For example, Trump is ahead of Harris by less than a point in Pennsylvania. In Michigan and Wisconsin, the vice president has a slight edge.
Putting aside today’s jobs report, Trump has done better than Harris in polls like the most recent Wall Street Journal national poll when it comes to the economy. There are 10 points more voters who like the former president’s business plan for the country than who don’t. By 4 points, people who don’t like Harris’s economic plan are more numerous than those who do.
When asked for a response on the October jobs report, the Harris campaign did not respond right away. President Joe Biden said that job growth would pick up again in November, “as our hurricane recovery and rebuilding efforts continue.”
On top of that, the study came out just a few days before the election and right before the Federal Reserve’s next interest-rate decision on November 7. Economists say that the central bank will likely ignore today’s news and cut rates again.
Ali Jaffery of CIBC Economics wrote in a note, “The Fed will likely look at the October data point, but they will wait until these short-term effects have worn off in a few months.” “They are more likely to pay attention to the trend up until September, which shows that the job market has clearly slowed down.” The next meeting is still when we expect the rate to drop by 25 basis points.
The jobs report made the markets happy, with the big stock indexes (DJIA, SPX, and COMP) all going up by more than 1%.
