· macrofireside.com · November 6, 2026
+165k payroll employment vs. +48k monthly average for the prior year. August and September revised up by 84k together.
Earnings +0.4% on the month, 3.1% on the year.
Unemployment 4.1%, as employment rose faster than the labor force (+463k vs. +421k).
Notably, the ranks of those not in the labor force were down 293k and participation up a tenth to 61.9%.
People walked back in and found work. That is the opposite of a rate flattered by a shrinking denominator, which is the version I have learned to distrust!
The part I care about is breadth. The one-month diffusion index for private industries went from 48.6 to 59.4, manufacturing from 45.8 to 68.8. September was a few sectors hiring; October was most of them.
Now the caveat I owe you, because October is a tricky month.
The seasonal factors already expect holiday hiring in retail and logistics and take it out. Transportation and warehousing still added 25k after that haircut, couriers 17k of it, so the holiday ramp looks early rather than illusory.
But last October was never collected (the shutdown), so this year’s October factors sit on one fewer year of history than usual. I take the print seriously. I do not take one print as gospel.
So, how’s the market handicapping the Fed now?
A 75% (vs 65%) chance of a Dec 9th hike and just under two hikes in total by end-2027.
Call it four basis points of repricing for a report that beat on every line that matters.
The reaction went into rates and the dollar, not stocks. Tens touched 4.90% and settled around 4.87%, fives up 4bp, DXY through 102.
S&P futures did nothing. Nasdaq futures were up, because Thursday’s semiconductor wreck still seems to be reverberating there. We shall see where they go from here.
I have sat through enough cycles to know what a central bank looks like when the data keep arriving on one side of its forecast. With wages running above 3%, energy costs doing what they are doing, job gains broadening and a committee that has already hiked once this cycle, I find it hard to construct fewer than two more hikes over the next fourteen months, and I can construct three or four without straining. The market is pricing a Fed that would rather not. Markets usually get the memo late. My book is positioned for the memo.
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Sources & References
US Bureau of Labor Statistics.