The much-anticipated October non-farm payroll report significantly exceeded expectations, with 165,000 new jobs added, far surpassing the market's forecast of 59,000. Several easily overlooked sub-categories in this impressive data are overturning the long-held mainstream view that "AI will replace labor," while also providing new clues about the sustainability of the job market.

Consulting roles are expanding significantly as companies hire consultants at high salaries to implement their AI transformation.

Management, science, and technology consulting jobs saw a net increase of 17,300 in October, marking the largest monthly increase in nearly two years. This sub-category contributed 25% of the job growth in the professional and business services sector that month. Over the past year, these positions have seen a cumulative increase of over 45,000, bringing the total number of employees in this field to over 1.9 million for the first time, setting a new record. Since 2023, hiring in the consulting industry had stagnated, with widespread market concerns that AI would reduce demand for consulting services, leading to a continued decline in the stock prices of related listed companies. Jeffrey Roach, chief economist at LPL Financial, stated that companies are hiring consulting teams in large numbers to assist in the implementation of AI. The AI infrastructure boom and the demand for corporate digitalization continue to support technical consulting positions, making this sector worth continued monitoring. Data from Moody's Analytics also confirms this, showing that since the launch of ChatGPT, AI has generated a net increase of 786,000 jobs. Mark Zandi, chief economist at Moody's, stated that the extreme scenario of AI causing mass unemployment has not yet materialized; currently, AI is generally driving employment rather than reducing jobs.

Temporary employment has rebounded significantly, but there is uncertainty regarding the overall employment climate.

Temporary support service positions saw 18,600 new jobs added this month, one of the best months since 2022, contributing 27% of the sector's new employment. While the total number hasn't yet returned to the 2022 peak, it has grown by about 3% since December of last year. Temporary employment has always been considered a leading indicator of employment; logically, companies hire temporary workers first and then convert them to permanent employees. However, the year-end period increases the difficulty of judgment, and this wave of hiring may also be to build up manpower for the year-end shopping season, with a higher risk of staff turnover after the holidays. The increase in courier delivery positions was also impressive, with one in ten new positions coming from this industry. Jason Pride, head of investment strategy at Glenmead, cautioned that these positions may face a subsequent decline.

Election spending boosts employment; election cycles bring temporary increases in jobs.

Data from the U.S. Bureau of Labor Statistics shows that employment in election-related sectors typically surges before midterm elections and presidential elections, usually peaking in October. This boosted non-farm payroll data before the 2018 and 2022 midterm elections. The 2026 congressional election is the largest midterm election in history in terms of campaign spending, with massive campaign funds translating into numerous short-term jobs. Campaign-related employment, such as door-to-door campaigning and telephone mobilization, provides temporary support for this round of non-farm payrolls. These jobs are event-driven and unlikely to continue after the election.

Conclusion

In summary, the strong performance of this non-farm payrolls report was supported by multiple factors. The emergence of consulting jobs driven by AI transformation represents a new medium- to long-term trend, while the increase in temporary and election-based jobs has a short-term nature. The narrative of AI replacing labor has been disproven in the short term, but this does not mean that long-term risks have completely disappeared. Changes in the employment structure will continue to influence the Federal Reserve's monetary policy decisions.