What's going on?

Companies in the US hired more people in October than any other month this year � which is good news for the economy!

What does this mean?

The jobs data on Friday showed that the US created many more jobs in October than economists were expecting. Almost as important was that average pay is also starting to increase meaningfully, suggesting that the low unemployment rate is finally causing people�s pay to move higher (fewer available workers means that companies should have to pay more to attract workers).

Why should I care?

1. The bigger picture: The increasing wage growth is important. Wages increased 2.5% versus one year ago, which might not sound like much, but considering that the rise in the cost of goods and services (a.k.a. inflation) is basically zero, it means that people are, effectively, getting wealthier. Often the increased wealth gets spent on other things in the economy, thus creating a positive, self-sustaining feedback loop. At least that�s the theory.
2. For the markets: Stocks actually initially sold off on the news. One might think that a good economy should be good for stocks, but the positive news makes it more likely that the US Federal Reserve will raise interest rates in December - and that could be bad for stocks. That�s because it could increase the value of the dollar and hurt companies that, for example, sell goods overseas. However, companies that do well when rates are higher � like banks and credit card companies � performed well after the news.