Economy

U.S. employment growth slows in September; unemployment rate drops to 7.9%

U.S. employment growth slows in September; unemployment rate drops to 7.9%”

Private sector employers added 877,000 jobs in September, though cuts by government and other public sector employers meant that the economy as a whole added just 661,000 workers during the month, according to Labor Department data. That compared with the median estimate of economists for a gain of 859,000. The unemployment rate among Latinos was 10.3 percent, down from 10.5 percent the previous month, while the rate for African Americans was 12.1 percent, down from 13 percent in August.

September's jobs report is particularly important because it's the last monthly jobs report prior to the November 3 presidential election.

The differential impact of the recession is also seen in the loss of part-time jobs. Economists had predicted a gain of 870,000 jobs last month.

In the news release, the bureau said that the numbers reflect a "continued resumption of economic activity that had been curtailed due to the coronavirus pandemic and efforts to contain it".

This is the first US recession in which service-sector jobs have been hardest hit, instead of goods-producing industries like manufacturing, and women make up a greater share of the workforce in service industries like retail and health. New York's insured unemployment rate at 13.7% and the USA territory of Puerto Rico at 12.8% rounded out the worst on the list. "However, it is unlikely to comfort the central bank, given that Americans continue to leave the labor force at an alarming pace".

This week, moreover, brought a new wave of layoff announcements reflecting the continuing slump in travel and tourism: Disney is cutting 28,000 jobs, Allstate will shed 3,800, and US airlines said as many as 40,000 employees are losing their jobs this month as federal aid to the industry expires. On an unadjusted basis, that figure actually rose, though by much less than typical for the start of the school year. The airlines had been barred from cutting jobs as long as they were receiving the government assistance.

The jobless rate fell to 7.9%, dropping for a fifth month, but the minority workers hit hardest saw little change. The category, which includes those actively searching for work for 27 weeks or more, underscores the lasting economic scars many Americans will have after months of joblessness.

More news: Joe Biden Releases Latest Tax Returns Ahead Of Debate With Trump

The number of people on temporary layoff fell by 1.5 million last month to 4.6 million - dramatically lower than 18.1 million recorded in April when tens of millions of Americans were thrown out of work during lockdowns.

The labor force participation rate declined 0.3 percentage points to 61.4 percent, erasing gains made in August.

In its report on jobless claims Thursday, the Labor Department said the number of people who are continuing to receive benefits fell to 11.8 million, extending a steady decline since spring.

Overall, the signs point to an economy losing steam just as the country heads to an election pitting Trump against former Vice President Joe Biden, in a contest that's now likely to be upended by the president's positive test for COVID-19. According to a Reuters survey of economists, non-farm payrolls likely increased by 850,000 jobs in September after rising 1.371 million in August.

Private payrolls rose by 877,000, which was in line with forecasts but still marked a slowdown from the prior month. Leisure and hospitality, which has suffered some of the biggest job losses, was the largest gainer among major sectors, adding 318,000 jobs - though total payrolls remain nearly 4 million below pre-pandemic levels.

Industries including oil, entertainment and financial services are all home to major companies announcing job cuts in recent days, which will take some time to show up in official data.

Walt Disney Co. said this week it would lay off roughly 28,000 employees in its theme parks division.



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