Market Overview

August Jobs Report Misses The Mark

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August Jobs Report Misses The Mark

The Bureau of Labor Statistics released employment data for the month of August, and the jobs report came in below expectations. Here’s a rundown of everything you need to know.

What You Need To Know

The nonfarm payroll number came in at +130,000, and the private payroll number was +96,000. Economists had expected +150,000 for nonfarm payrolls.

The unemployment rate remained at 3.7%, in-line with consensus estimates.

The so-called “real” unemployment rate, which factors in those out of the workforce and those who are underemployed, rose 0.2% to 7.2%.

Manufacturing payrolls were mostly flat, while professional and business services added 37,000 jobs, more than any other industry. The retail sector lost another 11,100 jobs in August.

Wages were a bright spot on the month, rising 0.4% month-over-month in August, beating the consensus target of 0.3%. Wages are up 3.2% in the past year.

June and July jobs estimates were also revised downward from 193,000 and 164,000 to 178,000 and 159,000, respectively.

Markets React

Investors seemed to shrug off the disappointing earnings report on Friday, with the S&P 500 on track to open higher once again coming off a 3% gain over the past five sessions. The Wall Street Journal reported on Thursday that the Federal Reserve is expected to once again cut interest rates by 0.25% this month, and Friday’s lackluster jobs report likely didn’t change the Fed’s mind.

Expert Take

Irina Novoselsky, CEO of CareerBuilder, said the August jobs numbers were disappointing, but companies are still aggressively hunting for qualified employees.

“The unemployment rate remains low at 3.7%, and viable options are available for job seekers to find jobs in the changing world of work. Fewer jobs were created over the last year than initially reported, yet CareerBuilder found 50% of HR managers have open positions they cannot fill due to a lack of qualified applicants and the rise of job-hopping,” Novoselsky said.

Novoselsky said the retail sector was once again a soft spot in August.

“The BLS’ major revisions included fewer jobs in retail - an industry that continues to be hit.”

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