U.S. labor market charges ahead as jobless rate falls

STORY: Data out from the U.S. labor department on Friday showed U.S. job growth slowed moderately in September compared with the month before, but hiring remained robust.

And the unemployment rate dropped to 3.5%. Both figures point to a still-tight labor market, meaning the Federal Reserve remains all but certain to continue aggressively raising interest rates.

BIDEN: "Where is it written that it says America can't be the leading manufacturer in the world again?"

Speaking at a Volvo facility in Hagerstown, Maryland Friday, President Joe Biden touted the low unemployment and job growth.

"Our economy created 263,000 jobs last month. That's 10 million jobs since I've come into office. That's the fastest job growth at any point of any president in all of American history."

The employment report showed the decline in unemployment from 3.7 percent a month ago was partly due to people leaving the workforce, and fewer Americans worked part-time for economic reasons.

Job growth has averaged 420,000 per month this year, and the labor market continues to show resilience despite the Fed's stiff interest rate hikes, which are aimed at reigning in consumer demand and rising prices.

"We have to move from a historically strong recovery to a more stable, steady recovery. We need to bring inflation down without giving up the historic economic progress that working class and middle class people have made."

The employment report suggested the economy was not in recession despite gross domestic product contracting in the first half. But risks of a downturn next year are mounting as the Fed ramps up its fight against inflation.

The U.S. central bank has hiked its policy rate from near-zero at the beginning of this year to the current range of 3.00% to 3.25%. September's consumer price report out next Thursday will help policymakers to assess their progress in taming inflation ahead of their November meeting.