The labor market is making its strongest job gains since before the recession, and the Federal Reserve is taking note—the Fed will likely point to October’s strong payroll gains in support of a coming rate hike in December.

Payrolls rose by 161,000 in October, compared to the 191,000 job gains reported in September, according to the Labor Department, and unemployment dropped to 4.9%. Economists say the labor market is reaching full capacity, and that most Americans in search of work have found employment.

“Welcome to the October numbers, where once again the Fed announcements will be shooting craps with the monthly results,” Yardi economist Jack Kern tells Bisnow. “[October’s jobs report] has some gold fodder for Fed Governors intent on a rate rise in December, but contains equal parts of concern that justify continued caution.”

Jack (above left) says though October’s employment rose slightly above consensus, it still fell short of the gains needed for a sustained growth pattern—though he says this report, like the prior three months, will likely soon be adjusted to reflect higher job gains. Jack says the Fed must take into account that employment sectors that account for the balance of the economy are flat.

“A rate rise is still very questionable when you look below the headline numbers,” he tells us. “The unemployment rate and the workforce participation rate are basically stalled, and productivity, while slightly improved, remains an issue.”

CRE consultant and former Trepp Talk senior director of research Susan Persin tells Bisnow the Fed will likely stick to its promise of raising rates at least once this year, and October’s healthy jobs report will further support that movement.

“I would expect a December increase in interest rates, given how things now stand,” Susan says. “The Fed has been pretty true to what it has said so far, and it is running out of runway to accomplish a 2016 increase…but a crazy market reaction to the election results could change everything. We’ll have to wait and see.”