You and your Thai Wife of 20 years.

[rooster59]

U.S. job growth cools; unemployment rate drops to 3.7 percent

By Lucia Mutikani

 

 

WASHINGTON (Reuters) - U.S. job growth slowed sharply in September likely as Hurricane Florence depressed restaurant and retail payrolls, but the unemployment rate fell to near a 49-year low of 3.7 percent, pointing to a further tightening in labor market conditions.

 

The Labor Department's closely watched monthly employment report on Friday also showed a steady rise in wages, suggesting moderate inflation pressures, which could ease concerns about the economy overheating and keep the Federal Reserve on a path of gradual interest rate increases.

 

Nonfarm payrolls increased by 134,000 jobs last month, the fewest in a year, as the retail and leisure and hospitality sectors shed employment. Data for July and August were revised to show 87,000 more jobs added than previously reported.

 

The economy needs to create roughly 120,000 jobs per month to keep up with growth in the working-age population.

 

"The weaker gain in payrolls in September may partly reflect some hit from Hurricane Florence," said Michael Pearce, senior U.S. economist at Capital Economics in New York. "There is little in this report to stop the Fed continuing to raise interest rates gradually."

 

Economists polled by Reuters had forecast payrolls increasing by 185,000 jobs in September and the unemployment rate falling one-tenth of a percentage point to 3.8 percent.

 

Fed Chairman Jerome Powell said on Tuesday that the economy's outlook was "remarkably positive" and he believed it was on the cusp of a "historically rare" era of ultra-low unemployment and tame inflation.

 

The U.S. central bank raised rates last week for the third time this year and removed the reference in its post-meeting statement to monetary policy remaining "accommodative."

 

The Labor Department said it was possible that Hurricane Florence, which lashed South and North Carolina in mid-September, could have affected employment in some industries. It said it was impossible to quantify the net effect on employment.

 

Payrolls are calculated from a survey of employers, which treats any worker who was not paid for any part of the pay period that includes the 12th of the month as unemployed. The average workweek was unchanged at 34.5 hours in September.

 

The smaller survey of households from which the jobless rate is derived regards persons as employed regardless of whether they missed work during the reference week and were unpaid as result. It showed 299,000 people reported staying at home last month because of bad weather, compared to an average of 85,000 for a normal September.

 

The weakness in payrolls last month is not corroborated by other labor market data. An Institute for Supply Management survey published this week showed robust employment gains in the services sector in September.

 

Economists also noted that the initial September payrolls growth estimate tended to be revised higher.

 

U.S. Treasury prices fell, with the yield on the 30-year bond rising to a four-year high. The dollar <.DXY> was little changed against a basket of currencies, while stocks on Wall Street were trading lower.

 

DIMINISHING SLACK

 

The drop of two-tenths of a percentage point in the unemployment rate from 3.9 percent in August pushed it to levels last seen in December 1969 and matched the Fed's forecast of 3.7 percent by the end of this year.

 

Average hourly earnings increased 0.3 percent in September after a similar rise in August. With September's increase below the 0.5 percent gain notched during the same period last year, the annual rise in wages fell to 2.8 percent from 2.9 percent in August, which was the biggest advance in more than nine years.

 

Wage growth remains sufficient to keep inflation around the Fed's 2 percent target.

 

Some economists say wage growth might be understated amid anecdotal evidence that worker shortages as a result of the tightening labor market were forcing companies to raise compensation. Online retail giant Amazon.com Inc <AMZN.O> announced this week that it would raise its minimum wage to $15 per hour for U.S. employees starting in November.

 

"Businesses of all sizes are indicating they are doing whatever they can to keep their workers," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. "The standard measures just don't reflect those increases well, if at all."

 

Last month, employment in the leisure and hospitality sector fell by 17,000 jobs, the first drop since September 2017, with payrolls at bars and restaurants tumbling by 18,200. Retail payrolls dropped by 20,000 jobs in September amid widespread declines across the sector.

 

Manufacturing payrolls increased by 18,000 in September after rising by 5,000 in August. Construction companies hired 23,000 more workers last month after increasing payrolls by 26,000 jobs in August.

 

Professional and business services employment increased by 54,000 jobs last month and government payrolls rose 13,000.

 

While surveys have shown manufacturers growing more concerned about an escalating trade war between the United States and China, it does not appear to have affected 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.

 

Washington last month slapped tariffs on $200 billion worth of Chinese goods, with Beijing retaliating with duties on $60 billion worth of U.S. products. The United States and China had already imposed tariffs on $50 billion worth of each other's goods. The trilateral trade agreement between the United States, Canada and Mexico was salvaged in an 11th-hour deal on Sunday.

 

Despite the Trump administration's protectionist trade policy, the trade deficit continues to deteriorate. The trade gap surged 6.4 percent to a six-month high of $53.2 billion in August, the Commerce Department reported on Friday.

 

The politically sensitive goods trade deficit with China increased 4.7 percent to a record high of $38.6 billion.

 

"Growth in imports likely will remain solid in coming quarters as long as growth in domestic demand remains buoyant," said Jay Bryson, global economist at Wells Fargo Securities in Charlotte, North Carolina.

 

 

-- © Copyright Reuters 2018-10-06

 

 

[PatOngo]

No doubt next week, the man with the weirdest hairdo in the history of mankind will be claiming these figures the greatest in the history mankind!

 

The politically sensitive goods trade deficit with China increased 4.7 percent to a record high of $38.6 billion. I can see the Chinese grinning.

[Morch]

2 minutes ago, PatOngo said:

No doubt next week, the man with the weirdest hairdo in the history of mankind will be claiming these figures the greatest in the history mankind!

 

The politically sensitive goods trade deficit with China increased 4.7 percent to a record high of $38.6 billion. I can see the Chinese grinning.

 

Alternatively, it would be some "fake news" claim, or blaming Obama/Dems.

[lanista]

You cant take seriously anything you read nowdays. Figures are meaningless'

US unemployment should be almost zero considering how low wages are over there. Millions of Americans have to work 2 or even 3 jobs just to pay the bills and unforeseen medical bills.

Apparently many adults in the US earn as little as 6 dollars an hour even less plus tips in the hospitality industry. Ive heard in some states its as low as 2.50/hour plus tips.

Millions of  Americans have almost 3rd world wages and conditions.

My 24 year old student niece in Australia earns $ 44.50 an hour working weekends as an usher at COMO cinema complex. She earns around $300/day as a ticket collector!

Road construction workers and tradesmen earn 32 -50 dollars an hour on weekdays. More on weekends.

Health care is free for all including  complex operations.

School kids probably get paid more /hour to do odd jobs than American adults earn in the work force.

We pay  about 6 dollars /gallon for gasoline to cover free healthcare.

Americans have very cheap gas. 

America is a great country if youre a WAll st banker or missile scientist at Lockheed or Northrop.  Wall st collapses soon and they'll be bailed out again .  Its the law.

The rest are camping out at Kmart.

Edited October 6, 2018 by lanista

[candide]

1 hour ago, PatOngo said:

No doubt next week, the man with the weirdest hairdo in the history of mankind will be claiming these figures the greatest in the history mankind!

 

The politically sensitive goods trade deficit with China increased 4.7 percent to a record high of $38.6 billion. I can see the Chinese grinning.

At the current level, Trump's tariffs actually have a positive effect on the Chinese economy.

(1) The RMB has now a lower exchange rate, without anyone accusing China to manipulate rates. Not only does it compensate for the higher tariffs, but it makes non-tariffed products cheaper (and also in other countries)

(2) China can cherry-pick products to be taxed in retaliation, i.e. not tax products that are necessary for their assembly business, and tax selected products that directly compete with Chinese products.

[heybruce]

Trump inherited a strong economy with low unemployment and pumped it up with a massive increase in deficit spending.  Economic logic dictates that when the economy is strong it's time to reduce deficits, but not Republican logic.  The country will be in serious trouble when the next recession hits, and there will be another recession.

[Tug]

It’s a sugar high the crash will come and it will be worse because of the added debt thanks Donald 

[Srikcir]

9 hours ago, rooster59 said:

The economy needs to create roughly 120,000 jobs per month to keep up with growth in the working-age population.

That shouldn't be a problem with the large numbers of foreign immigrants entering the US.

Oh, wait.

Trump admin cuts number of refugees U.S. will admit to lowest level in four decades.

https://www.nbcnews.com/politics/immigration/trump-admin-cuts-number-refugees-u-s-will-admit-lowest-n910461

9 hours ago, rooster59 said:

Despite the Trump administration's protectionist trade policy, the trade deficit continues to deteriorate.

Wasn't it that Trump alleged that foreign nations were taking advantage of the US through trade imbalances favoring foreign nations? That was the underpin for his trade war against many of the US trade partners.

[sirineou]

According to the bureau of labor statistics.

" Total compensation costs and consumer prices both rose 2.9 percent over the year ..."

https://www.bls.gov/opub/ted/earnings-and-wages.htm

Which means that there was no wage increase in Real dollars. If unemployment is so low it stands to reason that demand for workers would be high increasing wages to an inflationary level. yet the wage/inflation . push/pull situation is a wash. 

Why do we need a fed intervention?