

A tradition like no other: The jobs sign as an illustration of our jobs report story. (Karen Bleier/AFP/Getty Images)

The little recovery that could kept chugging along in October.

The economy added 214,000 more jobs, slightly below expectations of 235,000, but did add 31,000 more in revisions, so that the unemployment rate ticked down from 5.9 to 5.8 percent. And this was a case where the fine print told the same pretty good story as the headlines. The labor force actually grew a very healthy 416,000, which means that unemployment fell for the good reason that people were finding work, and not the bad one that they were giving up. It was enough that the employment-population ratio, the percent of people who have a job, reversed some of its long slide down the past few years, edging up from 59 to 59.2 percent.

Feel that recovery.

But, as always, it's better to look at the longer-term trend than to read too much into a single, noisy data point. And here, it was the same "meh" to "this might be a little bit better than meh" story that we've gotten to know so well. The good news is that monthly job growth has averaged 222,000 the past 12 months, 235,000 the past six, and 224,000 the past three. That's a small, but still significant, acceleration from the 174,000 jobs a month we got in 2011, the 186,000 we got in 2012, and the 194,000 we got in 2013. The recovery, in other words, is ever-so-slightly speeding up, not fizzling out, even as it's gone on for over five years now.

The not-so-good news, though, is that lower unemployment still hasn't translated into higher wages. Average hourly earnings didn't change much in October, up the same 2 percent a year that they were before. Indeed, as you can see below, there hasn't been any kind of relationship—an R-squared of just 0.02—between wages and unemployment since the recovery officially began in July 2009. Whether unemployment has been over 9 percent or under 6 percent, wages have just been growing about 2 percent a year, and that's it.

So where are the raises? After all, according to the Dallas Fed, wages should accelerate once unemployment falls below 6.1 percent. Well, the problem, as economists David Blanchflower and Adam Posen point out, is that there's still a lot of shadow unemployment right now. That includes people who aren't just officially jobless, but those who are either too discouraged to look for work, or who have part-time jobs but can't find the full-time ones they want. Now, this broader unemployment rate did fall from 11.8 to 11.5 percent in October, but it's still got a ways to go before it's back to normal.

The bottom line is that the economy is growing a little faster than it was before, but not so much that the Federal Reserve should move up its first rate hike from when it's expected next June. In fact, with wage inflation all but nonexistent, the Fed can afford to wait even longer to start raising rates, and see how low it can push unemployment down, kind of like it did in the '90s.

There's no reason to push our economic engine off track now.