The unemployment rate remained 4.9 percent for a third straight month, the Labor Department said Friday in its monthly jobs report.
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Forecasters has hoped for an even lower unemployment rate than 4.9 percent. At the same time, the government said, hourly wages remained stagnant in August. Those figures were weaker than economists polled by MarketWatch, who had expected 170,000 jobs to be added to the US economy in August, and a broader market consensus for about 180,000 jobs. USA employment growth slowed more than expected in August after two straight months of robust gains and wage gains moderated, which could effectively rule out an interest rate increase from the Federal Reserve this month, Reuters reported. Fed Chair Janet Yellen said in a speech last month that “the case for an increase. has strengthened in recent months”. “It confirms that the economy is performing well, but does not provide the threat of overheating that might have caused an interest-rate increase sooner rather than later”.
Checking on China: Worries about China’s economy have stalked the markets over the past year, but recent data, notably Thursday’s August purchasing manager’s index (PMI) that measures Chinese manufacturing, offered some hope. “Simply put, this report is not enough to compel the Fed to raise rates in September, and the focus will shift to December as the most likely date for the next rate hike”. Betting that low rates encourage businesses to borrow and invest, Fed policy makers are now split between those who worry that reducing the economic stimulus by lifting rates would derail a fragile economy and those who fear that waiting could allow inflation to take hold.
Consumers are more confident and have been spending at a steady clip. In 2016, monthly job gains flip-flopped, plummeting to 24,000 in May and swelling to more than 10 times that number in June. Both have been workhorses of the recovery, and their continued expansion is key to seeing the kind of continued job creation that the economy needs to stay above 80,000 per month.
USA shares inched higher and European shares rallied on Friday after weaker-than-expected U.S.jobs data gave the Federal Reserve more leeway to stand pat on interest rates, while the dollar gained and longer-dated Treasury yields edged up.
The US labor market disappointed in August.
On the currency markets, the pound broke through 1.33 United States dollar mark as the dollar following the jobs update, before paring gains to a 0.1% rise to 1.329 U.S. dollars.
“So the question becomes: Which one is more accurate?” he said. A private survey found that manufacturing shrank in August as new orders and production plummeted.
BIOGEN RISES: Drugmaker Biogen added $9.97, or 3.3 percent, to $316 after the company said its early Alzheimer’s disease treatment aducanumab will get a faster review from the Food and Drug Administration.
Mandatory minimum wage increases in some areas have contributed to larger paychecks.
That figure masks wide variations among industries and occupations.
Andrew Chamberlain, chief economist at Glassdoor Economic Research, characterized the report on Friday as “moderate to positive”.
“Wages are getting pressured across the board”, Gittrich said.
Health care hiring was a little off, and several categories of jobs, such as manufacturing, showed little or no change. Wage gains that had finally begun to materialize also eased up.
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Companies are still swooning over high-skilled engineers and technology workers. Chief executive David Brown has given up this year’s bonus as a result.
