Job Numbers Soar, but Trade Gap Widens on Tariff Pushback

(CN) – The U.S. economy added 250,000 jobs in October, as the labor market maintains its momentum ahead of Tuesday’s midterm elections, the Labor Department reported Friday, but a second government report was less optimistic, showing the U.S. trade deficit continues to expand.

On the employment front, the Labor Department said that the nation’s unemployment rate continues to hold at 3.7 percent, the lowest level since December 1969.

Prior to Friday’s report, economists had estimated that only about 208,000 jobs had been added last month, after gains averaging 218,000 over the past three months.

The economy has now added jobs for 97 straight months, beginning in October 2010 under former President Barack Obama. It is the longest streak of monthly jobs growth on record.

Wage growth ticked up with average hourly earnings rising 3.1 percent for the year.

Earlier this week, the government reported that private-sector wages increased 3.1 percent over the past year, which is the largest jump since 2008 and the first time wages eclipsed 3 percent since the financial crisis.

In related news, the Commerce Department said Friday that the gap between what America sells and what it buys abroad climbed to $54 billion, up 1.3 percent from $53.3 billion in August and the highest level since February.

Imports climbed 1.5 percent to a record $266.6 billion, led by an influx of telecommunications equipment and clothing.

Exports also rose 1.5 percent to $212.6 billion, led by increases in shipments of civilian aircraft and petroleum products.

Despite Trump administration tariffs on imported steel and aluminum and on Chinese goods, the deficit so far this year is up 10.1 percent to $445.2 billion.

The goods deficit with China rose by 4.3 percent in September to a record $40.2 billion.

China and other countries have responded to the administration’s agreesive trade actions, by placing import taxes on American products.

U.S. exports of soybeans, targeted for retaliatory tariffs by China, dropped 29.4 percent in September.

U.S. exports are also hurt by the American dollar’s role as the world’s currency.

The dollar is usually in high demand because it is used in so many global transactions. That means the dollar is persistently strong, raising prices of U.S. products and putting American companies at a disadvantage in foreign markets.

In September, the U.S. ran a $23.2 billion surplus in the trade of services such as banking and tourism. But that was offset by a $77.2 billion deficit in the trade of goods such as cellphones and cars.

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