A ‘Now Hiring’ sign is displayed outside a resale clothing shop on June 2, 2023, in Los Angeles.
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The US added 187,000 nonfarm payrolls in August, more than July’s revised growth.
The unemployment rate was 3.8% in August, an increase from July’s rate.
Fed Chair Jerome Powell said in a recent speech the labor market’s rebalancing “remains incomplete.”
Amid back to school season, summer outings with friends or vacations, and the SAG-AFTRA strike, the labor market is strong based on recent job growth.
The US added 187,000 nonfarm payrolls in August, according to the report released by the Bureau of Labor Statistics ahead of Labor Day. That beats the gain forecasted, an estimated increase of 170,000.
July’s payroll gain was revised from 187,000 to 157,000. June saw another revision. Per the latest release, it was revised from a gain of 185,000 jobs to 105,000.
While the unemployment rate was expected to be 3.5%, it was 3.8% in August. It ticked up from July’s 3.5%.
According to commentary from Lydia Boussour, EY senior economist, before the jobs report was published, EY believed the ongoing SAG-AFTRA strike would likely have a “noticeable impact” on August’s estimates.
“The SAG-AFTRA strike and bankruptcy of long-time trucking company Yellow in August will likely create some noise in the data and point to some downside risk to the headline payroll gain,” Boussour said in commentary prior to Fridays’ news release from BLS. “We estimate that these two factors could potentially pose a cumulative drag on payrolls worth around 30,000-40,000 jobs in August.”
Monthly job openings have continued to slow. There were 8.8 million job openings in July after 9.2 million in June, according to new Job Openings and Labor Turnover Survey or JOLTS data released by BLS earlier this week.
Jonathan Fisher, interim chief economist and research advisor at the Washington Center for Equitable Growth, said in commentary prior to Friday’s report that “the job market appears to be cooling to a sustainable level.”
“We saw in Tuesday’s JOLTS that both job openings and the quit rate are falling, and these are all positive signs that we won’t see unsustainable wage growth,” Fisher said.
Fed Chair Jerome Powell said in his speech last week at an economic policy symposium in Jackson Hole, Wyoming, that the “rebalancing of the labor market has continued over the past year but remains incomplete.”
“We expect this labor market rebalancing to continue,” Powell said. “Evidence that the tightness in the labor market is no longer easing could also call for a monetary policy response.”
This is a developing story. Please check back for updates.