According to payroll processor ADP, U.S. firms were shedding more than 11,000 jobs a week through late October. Despite a recent report indicating a gain of 42,000 jobs in October, the latest data suggests ongoing weakness in the labor market. ADP’s chief economist, Nela Richardson, noted the struggle to consistently produce jobs in the latter half of the month. This evolving hiring trend may prompt further reductions in the Federal Reserve’s benchmark interest rate, with investors expecting another cut at the December 9-10 meeting. ADP’s weekly payroll estimates serve as an alternative to official statistics currently unavailable due to the U.S. government shutdown.

As policymakers monitor the job market, developments in job creation and reductions will influence decisions regarding interest rates. The Fed’s recent rate cuts reflect concerns over weakening job market conditions, with potential for further adjustments in response to ongoing trends. The flow of data from the Bureau of Labor Statistics is expected to resume once the government shutdown ends, enabling policymakers to make informed decisions based on official statistics. Reporting by Howard Schneider emphasizes the importance of monitoring job market trends in relation to Federal Reserve policy decisions.