WASHINGTON — The highest unemployment rate in more than two decades overshadowed small signs of improvement in the U.S. labor market in October and could impact holiday season hiring for retailers.
The unemployment rate moved above 10 percent in October for the first time since 1983, despite a continued slowdown in the rate of job losses. The economy shed 190,000 jobs in October, the lowest monthly loss this year. The unemployment rate rose to 10.2 percent from 9.8 percent in September, the Labor Department said Friday.
“Will the real unemployment report please stand up?” said John Lonski, chief economist for Moody’s Investor Services.
The conflicting trends in the unemployment number and the improving payroll figures are creating confusion, he said.
“The jump in the unemployment rate will grab the headlines and unfortunately will have the effect of further diminishing an already low level of consumer confidence, and moreover, that jump in the unemployment rate will adversely affect how businesses view the future and thus hiring activity probably will be less than otherwise,” Lonski said.
The rise in unemployment is also likely to make skittish retailers even more reluctant to hire because of the resulting drag on consumer spending, Lonski said.
Department stores cut 11,100 jobs from payrolls in October to employ 1.51 million. Specialty stores added 2,700 positions to employ 1.42 million.
Job losses in October were concentrated in retail, manufacturing, leisure-hospitality and construction, said Nigel Gault, chief U.S. economist at IHS Global Insight.
Despite continued weakness on the employment front — always a bad sign for consumer spending — investors pushed the S&P Retail Index up 1.7 percent, or 6.59 points, to 395.34 Friday, making for a 3.9 percent rise for the week. The Dow Jones Industrial Average increased 0.2 percent for the day and 3.2 percent for the week to close at 10,023.42.
Of the 171 stocks tracked by WWD, 39 rose last week, while four were flat and 128 declined.
In the manufacturing sector, textile mills, which produce apparel fabric, cut 1,300 jobs to employ 120,000. Textile product mills, which make industrial and home furnishing fabric, eliminated 1,300 positions to employ 124,700. Apparel factories cut 600 jobs to employ 163,700.
“Today’s employment report contained both signs of hope for recovery and painful evidence of continued labor market weakness,” said Christina Romer, chair of the President’s Council of Economic Advisers.
While the employment picture painted in October was worse than expected, there were some glimmers of hope in the report, economists said. Employers added 34,000 temporary jobs, considered a leading indicator.
Economists predict job declines will continue to ease heading into the end of 2009 and that employment could show signs of growth by spring.
“It is statistically impossible to have jobless claims decline and unemployment rise indefinitely,” Lonski said.
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)
@Pharrell and his wife Helen Lasichanh were among the stars that came out to celebrate @rimowa’s first pop-up concept shop. The space, which is located on Rodeo Drive in Beverly Hills, draws inspiration from airport luggage carousels and lounge areas – and features the company’s luggage and accessories. If the pop-up is successful it could pave the way for addition temporary shops throughout the world. #wwdfashion (📷: Owen Kolasinski/BFA)
@carineroitfeld celebrated @crfashionbook’s first calendar last night with a dinner party at Spring Place in Manhattan. Photographed by @stevenkleinstudio, the calendar takes on a fitness theme and features @joansmalls, @gigihadid, @danielle_herrington_ – pictured here – and more. “[Carine Roitfeld] wanted me to feel sexy and she wanted me to be myself and feel it out on my own and do what I felt was right,” said Herrington, aka Miss October. #wwdeye
@saintrecords and @virgilabloh last night at @americanexpress’ “A Night With Success Makers” event. “I always bring it back to community because without that I wouldn’t have the courage,” said Knowles when asked how she has gotten where she is now. Read more highlights from their conversation on WWD.com. #wwdeye (📷: @lizdoupnik)
This Just In: Industry sources have told WWD that Anastasia Soare is rumored to be considering selling her beauty business, @anastasiabeverlyhills. According to those sources, Soare has tapped investment bank Imperial Capital to explore sale options for her eponymous beauty brand –– and with at least $340 million in net sales, this would be a big deal. Put in context of other recent transactions for makeup companies, Soare’s price tag could be in the billions if she were to sell the whole thing. #wwdnews #wwdbeauty (📷: @clint_spaulding)
@assouline’s latest book, “The Spirit of Bentley: Be Extraordinary” captures the adventurous attitudes and opulent lifestyles of @bentleymotors’ most creative owners and enthusiasts throughout the U.K. The 292-page hardcover has a section dedicated to showing its team of skilled artisans and photos of its most colorful owners, from George Bamford to designer @alicetemperley, pictured here by Aline Coquelle. #wwdeye
@google released its report on the most popular search terms this year. For fashion brands, the list was led by @gucci, the luxury brand that stunned the market last October when it pledged to stop using fur. Runner ups were @supremenewyork and @fashionnova, along with more established brands like @louisvuitton, @chanelofficial and @ysl. #wwdfashion (📷: @aitorrosasphoto)
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)