* Nonfarm payrolls forecast rising 180,000 in October
* Unemployment rate seen holding steady at 5.1 percent
* Average hourly earnings expected to increase 0.2 percent
* Expected solid jobs report would support December rate
By Lucia Mutikani
WASHINGTON, Nov 6 U.S. job growth likely
accelerated in October after two straight months of tepid gains,
with wages also picking up in a show of domestic strength that
would bolster prospects for a December interest rate hike from
the Federal Reserve.
A Reuters survey forecast nonfarm payrolls increasing
180,000, well above the 139,000 jobs per month average for
August and September. Should payroll gains meet expectations, it
would add to robust automobile sales in painting an upbeat
picture of the economy at the start of the fourth quarter.
With speeches from several Fed officials, including Chair
Janet Yellen, suggesting a low bar for a December rate increase,
economists say job gains above 150,000 in October and November
would be sufficient for the central bank to lift benchmark
overnight borrowing costs from near zero.
Minutes from the Fed's Oct. 27-28 meeting and subsequent
comments from Yellen have firmly put a rate hike on the table at
the central bank's upcoming Dec. 15-16 gathering.
"It's not great job growth but it's respectable and will
qualify as good enough for the Fed to feel comfortable to raise
rates," said David Donabedian, chief investment officer at
Atlantic Trust Private Wealth Management in Washington.
The Labor Department's closely watched jobs report will be
released on Friday at 8:30 a.m.(1330 GMT).
It will likely join October's strong services sector and
auto sales data in supporting views that economic growth will
regain momentum in the fourth quarter after braking sharply to a
1.5 percent annual pace the July-September period.
Wages, which have been almost stagnant despite a tightening
labor market, are forecast rising 0.2 percent in October after
holding steady in September. Even with the expected gain, the
year-on-year reading would bump up to only 2.3 percent, a
still-tepid pace that threatens little inflation pressure.
The unemployment rate is expected to have held steady at a
more than seven-year low of 5.1 percent, just a touch above the
level many Fed officials see as consistent with full employment.
Economists also expect payroll gains for August and
September will be revised higher as the sharp slowdown evidenced
in prior reports was not supported by other labor market
indicators, such as weekly claims for jobless benefits, which
are near 42-year lows.
"The report will continue this pattern of an economy which
is growing at a steady pace, but clearly with a labor market
that is tightening," said David Kelly, chief global strategist
at JPMorgan Asset Management in New York.
Economists anticipate some improvement in other labor market
measures that Fed officials are eyeing as they contemplate
raising rates for the first time since 2006.
But the labor force participation rate, or the share of
working-age Americans who are employed or at least looking for a
job, likely held at a near 38-year low of 62.4 percent.
Employment gains in October were likely broad-based, though
manufacturing and mining probably lost more jobs.
Manufacturing has been hit by a strong dollar, efforts by
businesses to reduce bloated inventory and spending cuts by
energy companies cutting back on well drilling and exploration
in response to lower oil prices.
Mining employment has already declined by 102,000 since
reaching a peak in December 2014. Oilfield services provider
Schlumberger last month announced further layoffs in
addition to the 20,000 jobs it has already eliminated.
Construction payrolls, however, are expected to have
increased further, although the gains likely remained modest.
Strong job gains are expected in the services sector,
especially in retail, health and leisure. Government payrolls
are expected to have increased by 15,000 last month.
(Reporting by Lucia Mutikani; Editing by Tim Ahmann and