The US economy added 156,000 jobs in August, according to the Bureau of Labor Statistics. That was below Wall Street expectations of 180,000. Hurricane Harvey did not affect the August job numbers, but is expected to impact September employment.
The unemployment rate, which is calculated from a different survey of households, ticked up to 4.4 per cent from a 16-year low of 4.3 per cent in July. Many discouraged workers remained on the sidelines, despite the tightening job market. The labour force participation rate was unchanged, at 62.9 per cent.
Revisions to the previous two months subtracted a total of 41,000 jobs. The figure for July was revised down to 189,000 from 209,000, while the June number was reduced to 210,000 from 231,000. Non-farm payroll have increased by an average of 176,000 per month so far this year. That compares with the average gain of 187,000 per month in 2016. The US economy needs about 100,000 jobs per month to keep up with population growth.
The number of Americans working part-time for economic reasons fell by 27,000 to 5.26 million. A broader measure of unemployment – which includes people working part-time, because they can’t find a full-time position and those who are marginally attached to the labour force – was unchanged at 8.6 per cent. A year ago, the U-6 figure stood at 9.7 per cent.
Private employment increased by 165,000, while government payrolls fell by 9,000. Professional and business services led the job gains, with 40,000. The manufacturing sector, which lost more than 2 million jobs in the last recession, added 36,000 positions. Construction companies created 28,000 jobs. Retailers hired just 800 workers.
The US economy grew at an annualised pace of 3 per cent in the second quarter, its fastest pace since the beginning of 2015. The average growth rate in the first half of the year was 2.1 per cent. Wage growth was disappointing, despite solid economic expansion and steady hiring. Average hourly earnings rose 3 cents to 26.39 dollars. Wages were up 2.5 per cent from a year ago. The wage growth number is higher than inflation, but right at the level at which it has been for years. The average workweek for all workers fell to 34.4 hours from 34.5 hours.
The August jobs report is unlikely to change the Fed outlook, which includes the reduction of the central bank’s 4.5 trillion dollars balance sheet this month and a rate hike in December.
