The newest report came just two weeks after the Fed decided that the economy’s advance was still too fragile to risk lifting interest rates from their near-zero level, even as it hinted that it might go ahead by December.
It is safe to assume the Fed policy on rates, the growth of the labor market and the reactions of the stock market will all continue to be erratic.
Anything near or above 200,000 jobs is considered healthy and economists surveyed by CNNMoney predicted there would be 204,000 jobs gained in the month. Last year, job growth averaged 260,000 a month.
Whatever it is, though, it’s a good reason to hold off on raising rates for now. The odds of any increase in rates this year slid below 10pc, according to market data. “This is more than enough to keep the Fed on the sidelines in October“.
Moreover, the rate at which businesses have added workers has largely disappointed this year, and especially in the past three months.
Now, this is the part where I remind you that there is a lot of randomness in a single jobs report.
USA consumers are spending at a healthy pace, boosting job gains in sectors like retail and hotels and restaurants.
Monthly employment report of the Labor Department, which is going to release on Friday, will nearly certainly show that the country’s economy is growing faster, and could push the USA jobless rate lower in near future.
The Fed has been widely expected to raise interest rates later this year, but Fed members have been delaying a hike as they wait for the job market to show a few real strength.
US hiring slowed sharply last month and previous job gains were revised lower amid a broad slowdown in the global economy.
Overall, the September jobs report raises questions about the USA economy’s momentum heading into the end of the year.
Manufacturing has been especially hard hit due mostly to a stronger dollar and a weak demand for American exports.
Many economists estimate that economic growth slowed to an annual pace of between 1% and 2% in the third quarter. Economists have looked for accelerating wage growth of labor market tightening, but it has yet to materialize.
But other details pointed to underlying weakness.
There were no signs of wage growth in August.
Average hourly wages fell by 1 cent to $25.09 during the month and were only 2.2% higher than the same month in 2014.
Although the rate of unemployment has held steady the participation of the labor force dropped from 62.6% to 62.4% in September. Over the year, this industry has added 349,000 jobs.
Private-sector payrolls grew by just 118,000, with the government accounting for the rest of the gains. Professional and business services added 31,000, which was substantially lower than the 45,000 mark delivered in recent months.
Government payrolls rose by 24,000.
Mining employment fell by 10,000.