United States: Payrolls growth slows in September
October 22, 2013
Non-farm payrolls grew by 148,000 in September, which was less than August's revised increase of 193,000 (previously reported: 169,000). Moreover, the reading was below market expectations of an increase of 185,000 payrolls.
The private sector is still almost entirely responsible for new hiring, having added 126,000 jobs in August. The largest gains were registered in construction, wholesale trade, and transportation and warehousing. Meanwhile, the public sector added just 22,000 jobs.
The U.S. economy has recovered 6.9 million jobs since February 2010, which marked the trough in the labor market crisis. The economy still has roughly 1.7 million fewer jobs than it had during the January 2008 peak, despite the ongoing improvement over the past three years.
The unemployment rate - derived from a different survey - inched down from 7.3% in August to 7.2% in September, marking the lowest level in more than four years. The reading was just below market expectations of no change. The drop in unemployment, which occurred despite lower than expected payroll gains, is driven in part by the continuing decline in the labor force participation rate. The participation rate currently sits at 63.2%, the lowest level since August 1978.
FocusEconomics Consensus Forecast panelists expect unemployment to average 7.5% this year, which is unchanged from last month's forecast. For 2014, the panel expects the unemployment rate to drop to 6.9%, which is also unchanged from last month's forecast.
Author: Carl Kelly, Economist