Figures released on September 6th by the Bureau of Labor Statistics showed that total non-farm employment increased by 169,000 in August, a little more than in July.
The US Department of Labor revised down its estimates for jobs gains in June and July by a total of 74,000.
The unemployment rate fell from 7.4 per cent to 7.3 per cent, the lowest level since December 2008, but for a negative reason as people stopped looking for jobs.
The long-term unemployed – those who have been unemployed for 27 weeks or more – accounted for 37.9 per cent of the unemployed.
The proportion of people who were either employed or actively looking for work, a measure known as the labour-force participation rate, decreased to 63.2 per cent, the lowest level since August 1978.
Employment in the private sector rose by 152,000. Federal, state and local governments added 17,000 jobs. Retailers created 44,000 jobs. Employment in health care and social assistance increased by 38,300. The leisure and hospitality sector created 27,000 new positions. Professional and business services added 23,000 jobs. Manufacturers hired 14,000 people. The recovery in construction stalled.
The average workweek rose to 34.5 hours from 34.4 hours.
Average hourly earnings for all employees on private non-farm payrolls rose by 5 cent on the previous month to 24.05 dollars.
The Federal Reserve is expected to keep its main interest rates close to zero until the unemployment rate falls below 6.5 per cent, and the outlook for inflation doesn’t exceed 2.5 per cent. The rate-setting committee will have to decide at its next meeting on September 17-18, whether this month is the right moment to start tapering of the 85 billion-a-month asset-buying programme. A continued gradual improvement in the labour market and the strength of the services sector may convince the US central bank to scale back its ultra-loose monetary policy.
The Fed’s plan to scale back its stimulus programme this year and stop it entirely by mid-2014 if the economy continues to improve, has sent the yield on the benchmark 10-year Treasury note to over 2.9 per cent. The yield has climbed by about 1 per cent since May, when Ben Bernanke, the Fed chairman, announced that the central bank might consider pulling back from its economic stimulus, if an employment outlook improved substantially.
photo: U.S. Army Corps of Engineers / flickr.com / CC BY 2.0
