The U.S. economy added 165,000 jobs in October, according to the Bureau of Labor Statistics. That beat the Dow Jones estimate of 59,000. The unemployment rate fell to 4.1%, below the forecast of 4.2%.
A broader measure that includes discouraged workers and those in part-time jobs for economic reasons rose 0.3 percentage point to 7.9%. The civilian labor force grew by 421,000 in October.
The bureau also revised prior months up. August's figure rose to 186,000, an upward revision of 53,000. September's count moved to 60,000, up 31,000.
Average hourly earnings rose 0.4% on the month and 3.1% from a year earlier. Estimates had been 0.3% and 2.9%. The average workweek held at 34.4 hours.
Dan North, senior economist at Allianz Trade North America, called it "a really, really good report" and said it was "stronger than expected and the best one in a while." He described the labor market as "stable but perhaps unexciting."
Seema Shah, chief global strategist at Principal Asset Management, said the report was "a strong rebuttal to fears that the economy is heading into a meaningful slowdown."
Professional and business services led job gains with 70,000. Healthcare added 42,000, transportation and warehousing added 25,000, and manufacturing added 19,000.
Heather Long, chief economist at Navy Federal Credit Union, said the economy in 2025 "added barely 10,000 jobs a month and basically all were in healthcare."
Long-term unemployment rose sharply. The average duration of unemployment reached 27.1 weeks, up 2.3 weeks and the highest since September 2021. The number of people unemployed for more than 27 weeks rose to 1.96 million, the most since December 2021.
Traders increased the probability of another quarter-point Federal Reserve rate hike at the Dec. 8-9 meeting to 76.8%, according to the CME Group's FedWatch tool. Inflation remains above the Fed's 2% target. Market reaction was muted, and Treasury yields rose across the board.