U.S. employers added fewer than 200,000 jobs in September, sharply undershooting market expectations and painting a picture of labor market recovery that’s on wobbly footing.
Labor Department鈥檚 jobs report,聽released Oct. 8, shows that聽non-farm payroll employment rose by a paltry 194,000 last month, down from last month’s upwardly revised 366,000 and far below the FactSet-provided consensus forecasts of 500,000.
“ latest snapshot of the job market is a bit of a bad news, good news affair,”聽Bankrate senior economic analyst Mark Hamrick said in an emailed statement to Pezou.
“It delivered a surprisingly weak payrolls number,” Hamrick said, adding, “at the same time, the nation鈥檚 unemployment rate slipped four-tenths to a pandemic era low of 4.8 percent.”
total number of unemployed persons fell by 710,000 to 7.7 million, the report showed. While that’s considerably lower than the pandemic-era high, it remains elevated compared to the 5.7 million just prior to the outbreak.
Leisure and hospitality, including bars and restaurants, generated only 74,000 jobs, a result that’s below expectations. re was also weakness in local government educations jobs, which fell by 144,000 last month despite schools reopening.
re was relative strength in manufacturing, which added 27,000 jobs, and transportation and warehousing saw a jobs boost of 47,000 positions.
Overall, government payrolls fell by 123,000 jobs in September, which was offset by an increase of 317,000 in private payrolls.
labor force participation rate, which is a measure of people working or actively looking for work, remained little changed at 61.6 percent, a historically depressed level. In February 2020, the labor force participation rate stood at 63.6 percent, with a historical peak of 67.3 percent in April 2000.
“Some have thought the end of pandemic employment benefits would bring a rush of potential workers back into the equation. We鈥檙e not seeing that yet,” Hamrick said.
Republicans were quick to pounce on the dismal jobs report, blaming the Biden administration’s policies for the weak print.
“With only 194,000 jobs added back to our economy last month, it is clear that President Biden’s failed economic policies are shuttering small businesses,” wrote Republicans on the House Committee on Small Business, on Twitter.
Republican National Committee, in a statement,聽said that “Biden promised to create jobs, he promised he had a secret plan to ‘shut down the virus.’ Trump handed Biden vaccines and a recovery economy, and Biden has still failed at both.”
“Pro tip: the top ten states leading the recovery are all led by Republican governors. If Biden wants to spur growth, he should take his cues from them,” the RNC added.
Red states, on the whole, have dominated the economic recovery, recording the lowest rates of unemployment in the United States in August 2021.
White House Chief of Staff Ron Klain took to Twitter to defend President Joe Biden’s record on job creation.
“ unemployment rate is now down to 4.8 percent鈥攊n just eight months. We’ve created 2x more jobs under @POTUS in his first nine months than any administration in history,” Klain wrote.
Besides painting a dim view of the vigor of the labor market recovery, the lackluster jobs report could also delay an expected decision by the Federal Reserve to begin scaling back monetary support before the end of the year.
labor market remains a key touchstone for the Fed, with Federal Reserve chair Jerome Powell repeatedly hinting that reaching full employment was a pre-requisite for the central bank to start trimming asset purchases.
Investors are looking for clues as to when the Fed will initiate the much-anticipated rollback of its massive $120 billion in monthly purchases of Treasury and mortgage securities, one of the crisis support measures the central bank deployed last year to help lift the economy from the pandemic recession.
Pezou : American Employers Added 194,000 Jobs in September, Far Below Expectations