October Jobs Report: Now the Fed Can Raise Interest Rates!

The October Jobs Report released today included plenty of good news (271,000 net new jobs, the unemployment rate down to 5.0%–a seven-year low–pretty good job gains in virtually every sector other than mining, manufacturing and government, and even a slight rise in average wages) and no notable bad news (work-force participation and long-term unemployment were flat, not rising).

So that means Hooray! the Federal Reserve Board has probably run out of excuses for not initiating the interest rate hike creditors and inflation-obsessed conservative economists have been demanding for many months now. The New York Times‘ Nelson Schwartz gives us the bottom line:

“At last, a payroll report which makes sense,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics. After two relatively weak reports that were hard to explain, given other, healthier economic data, he said, “this is consistent with all the advance indicators.”

“Barring a disaster in November,” Mr. Shepherdson said, “rates are going to rise in December.”

Sorry to be cynical here, but aside from the phantom menace of inflation, I guess we can’t have too much economic growth in a presidential election year when Democrats control the White House, can we? On the other hand, the odds of a pre-election recession seem pretty low as well, assuming Janet Yellen keeps the champions of deflation under control.

Ed Kilgore

Ed Kilgore, a Monthly contributing editor, is a columnist for the Daily Intelligencer, New York magazine’s politics blog, and the managing editor for the Democratic Strategist.