US wage growth hits nine-year high

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US wage growth hits nine-year high

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Wages in the US grew at their fastest pace for nine years last month, according to the latest official figures.

The US Labor Department said wages grew at an annual rate of 3.1% in October, accelerating from a rate of 2.8% the month before.

The economy also added 250,000 jobs last month, which was well ahead of analysts’ expectations.

The unemployment rate remained unchanged at 3.7%.

Most sectors of the economy saw job gains, the Labor Department figures show.

The healthcare sector added 36,000 jobs, manufacturing 32,000 and construction 30,000.

Employment in the leisure and hospitality sector rose by 42,000 last month. That followed no change in September, which the Labor Department said was probably due to the impact of Hurricane Florence.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: “In short, the labour market continues to tighten. Nothing in this report will make the Fed think that skipping the December [interest rate] hike is a good idea.”

The Federal Reserve last raised rates in September, bringing the target for the bank’s benchmark rate to a range of 2%-2.25%.

The move was the bank’s eighth rate rise since 2015, continuing its policy of gradual increases.

However, US President Donald Trump has criticised the Fed’s actions. When asked last month by the Wall Street Journal about what he saw as the biggest risks to the US economy, Mr Trump said: “To me the Fed is the biggest risk, because I think interest rates are being raised too quickly”.

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