A blowout October jobs report landed Friday with estimates from the U.S. Bureau of Labor Statistics showing hiring more than doubled forecasts.

Employers added 165,000 jobs in October and the unemployment rate fell to 4.1% from 4.2% a month earlier. Hiring in August and September was revised higher by a combined 84,000 positions.

Economists surveyed by Reuters and Dow Jones had predicted job gains of around 65,000 and had expected the national jobless rate to remain unchanged.

The labor force participation rate increased for a third straight month to 61.9% from a more than five-year low of 61.4% seen in July.

“While the headline unemployment rate decreased, some of this was due to individuals taking part-time work when they would have preferred a full-time position,” explained Mike Fratantoni, chief economist at the Mortgage Bankers Association. He added that employment growth “broadened somewhat” last month as access to jobs remained mixed.

“Individuals who have lost jobs are also finding a difficult time getting back in, as the median and average length of unemployment spells are increasing,” Fratantoni also said in commentary shared with Scotsman Guide.

Initial estimates of strong job growth last month showed broad-based gains. Healthcare and social assistance employers added 55,000 positions to their payrolls, while professional and business services firms added 70,000. Manufacturing and temporary help services hiring each rose by about 19,000.

The leisure and hospitality sector shed the most workers, erasing the 13,000 positions those employers had added the previous month.

The hot jobs report comes as government data shows inflation broadly accelerating in September. The Federal Reserve’s preferred inflation gauge posted 3.6% annual growth in September, up from 3.4% in August.

Fed policymakers left the benchmark federal funds rate unchanged in late October following their first rate hike in three years in September. Accelerating inflation and the robust labor figures both support a broadly expected Fed rate hike in December.

Market-implied odds of a quarter-point hike at the Fed’s next meeting rose to 80% after the employment numbers landed Friday morning, up from 67% on Thursday, according to CME FedWatch.

With the housing sector staring down the barrel of another tough production environment in 2027, the strong jobs report says to expect more of the same. Though mortgage rates have declined for three straight weeks, they remain above year-ago levels, averaging 7.18% for typical 30-year loans this week, per Freddie Mac.

“The rebound in hiring, upward revisions and low unemployment point to a healthier labor market, keeping a December rate hike firmly in play and potentially delaying mortgage-rate relief,” said Sam Williamson, senior economist at title insurance giant First American Financial Corp.