Biden just got good news for the economy one day after disastrous elections - 571,000 private payroll additions in October

Employers set up booths to promote their company benefits, salary scales, and sometimes recruitment bonuses to get job applicants to visit their booths at the Lee County Area Job Fair, Tupelo, Miss. Tuesday, October 12, 2021. Rogelio V. Solis/AP Photo
According to ADP's monthly jobs report, 571,000 private sector jobs were added in October by US companies.

The print out beat the forecast of 400,000 employees and showed that hiring was on the rise since September.

This is good news for Biden in the economy but it comes only one day after a shocking loss by a Democrat at Virginia's gubernatorial elections.

In October, the US private sector added more jobs that expected. This signals much stronger job growth and positive news for President Joe Biden's economy after months of slow recovery. But is it too late?

ADP reported that private payrolls increased by 571,000 in its monthly employment report. This was well above the Bloomberg-surveyed 400,000-payroll estimate. This is the largest one-month gain in a month since June.

ADP's September hiring print was revised from 568,000 to 523,000

Two trends shaped October's labor market recovery. The monthly number of virus cases fell, with daily counts at their lowest since July. The Delta wave, after months of soaring infections, is now in decline.

But supply-chain bottlenecks caused severe problems that hampered the recovery. Businesses were left scrambling for the same level of spending as Americans due to shipping delays and shortages. However, Americans can still look forward to greater job creation as long as the virus situation improves, Mark Zandi of Moody's Analytics, chief economist, stated.

He stated in the report that "the job market is revving up as the Delta wave a pandemic winds down" "So long as the pandemic is contained, there will be more job gains in the coming months."

The White House has reason to be happy with the report, as Tuesday's election results disappointed the Democratic Party. As a sign that the voters are dissatisfied with the party's unified control over Washington and its economic management, Terry McAuliffe was defeated by Republican Glenn Youngkin on Tuesday in what had been a safe Democratic seat. The party was also shocked by a too close-to-call race to the New Jersey governorship. It was a dark night that came a year before midterm elections. During which party in power loses seats, Democrats are barely in control with razor thin majorities in the Senate and the House.

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After two months of disappointing job reports, the stronger job gains are now. The US only added 194,000 nonfarm payrolls to its September numbers, which was well below the expectations of a 500,000-payroll boom. Also, the August gain of 36,000 was below expectations. These two months saw the largest part of the Delta wave. Economists generally attributed the low hiring to the weakness in the economy. The Wednesday print suggests the US could soon resume the strong hiring that was evident throughout the summer.

Economists remain optimistic. According to Friday's median forecast, the US will add 450,000 nonfarm payrolls in Oct. This is more than twice the September gain.

As the Delta wave recedes, service businesses are hiring up

The report's finer points show that the majority of the labor market's recovery is still being driven by the service sector. This industry saw an increase of 458,000 jobs compared to 113,000 gains for goods-producing companies.

According to the report, 185,000 jobs were created by leisure and hospitality businesses, while 88,000 payrolls were added by the professional and business service sector. The Delta wave and lockdowns were particularly hard on service businesses. The latest ADP data shows that case counts are falling and that firms' recovery efforts will accelerate through the fall.

Construction saw the greatest increase in goods-producing sectors, with a 54,000-payroll rise. This is a good sign for the US housing market. The recovery was not easy for homebuilders, who struggled to rehire workers. This made it harder for firms to provide housing supply support. The October gain in construction is the biggest since September 2020, indicating that firms may soon be able to address the country's housing shortage.

The labor market is far from being fully recovered, it's certain. According to the Bureau of Labor Statistics, nearly 8 million Americans were still unemployed as of September. The Biden administration still expects significant progress in 2022. Even after two disappointing job reports, Janet Yellen, Treasury Secretary, stated that the US is on track to achieve full employment in 2022.

Business Insider has the original article.