Economy

Strong U.S. job growth expected in September; wages seen rising

Strong U.S. job growth expected in September; wages seen rising”

The good news does not necessarily mean that Americans are being paid better, however - the average hourly wage was up just 2.8% compared to the same time a year ago.

Economists expected only a marginal impact on payrolls from Hurricane Florence, which lashed South and North Carolina in mid-September. The U.S. central bank raised interest rates last week for the third time this year and removed the reference in its post-meeting statement to monetary policy remaining "accommodative".

"That said, 134,000 job is far from a awful employment number and with August's being revised up by another 69,000, the labour market looks extremely healthy and provides further evidence of a booming economy". If more people start looking - and don't immediately find a job - the government will count them as unemployed. According to the BLS, the average monthly gain in jobs for the past 12 months has been 201,000.

The unemployment rate is now at 3.7 percent, the lowest rate since December 1969, when the jobless rate was 3.5 percent. The job growth numbers for July and August were revised up by 87,000, bringing the three-month average to 190,000.

Figures from the Department of Labor also showed the USA economy created 134,000 jobs during the month, fewer than were expected. But the hurricane could have cut the workweek and lifted wages as it probably kept workers in the low-paying restaurant and retail industries temporarily at home.

The economy does show some weak spots. An Institute for Supply Management survey published this week showed robust employment gains in the services sector in September. The report said that average hourly wages increased by 8 cents to $27.24. Black and Hispanic unemployment rates continue to hover near record lows.

By industry, the strongest wage growth is in the low-paying restaurant sector, which has seen a 4.3 percent increase in the average hourly wage for production and nonsupervisory workers over the a year ago. This is the lowest it has ever been, with the exception of May when it hit 5.9 percent. Overall government payrolls increased by 13,000.

Amazon's announcement this week that it would increase its minimum hourly wage to $15 for all its USA employees elevated the pressure on other employers to lift their wages as well. That category saw an 18,200 decrease in payrolls, according to the report.

Manufacturers, which are more dependent on foreign markets than other industries, added 18,000 jobs last month, a sign that President Donald Trump's trade fight with China and other countries is having little effect on hiring. In fact, the Fed's latest survey of national business conditions reflected concerns about labor shortages that are extending into non-skilled occupations as much as about tariffs.

Retailers had the worst month for hiring, as the sector lost 20,000 jobs.

Washington last month slapped tariffs on $200 billion worth of Chinese goods, with Beijing retaliating with duties on $60 billion worth of USA products. Many of those jobs are likely to bounce back in the coming months. The Trump administration has imposed tariffs on imported steel and aluminum as well as on roughly half of China's imports to the United Sates.



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