US job growth stumbles in August with 130,000 added
U.S. employers added 130,000 jobs in August, missing Wall Street's expectations, as trade uncertainty and slowing global growth darkened the economic outlook.
The unemployment rate remained steady at 3.7 percent, near a 50-year low, while the labor force participation rate was little changed at 63.2 percent. Average hourly earnings, meanwhile, rose 3.2 percent over the past year to $28.11. That was slightly higher than projections of 3.1 percent.
Economists expected employers to add 158,000 jobs, in line with average growth this year but sharply below the 2018 average of 223,000. The June and July jobs numbers were trimmed by a combined 20,000, the Labor Department said Friday.
Employment in the federal government increased in the last full month of summer, but mostly reflected the hiring of temporary workers for the 2020 census. Excluding those employees, August payrolls grew by 105,000 jobs.
Notable gains also occurred in health care, which added 24,000 jobs, and the finance industry, which grew by 15,000.
The lower-than-expected growth comes amid fears that the current economic expansion in the U.S., which has reached a record length, is beginning to slow and may be followed by a recession within two years. Industries on the front line of the U.S.-China trade war continued to report losses.
“The on-again, off-again U.S.-China trade talks continue to roil markets and, in some ways, are mirroring the on-again, off-again Brexit debate," said Tony Bedikian, managing director at Citizens Bank. "Both issues are providing market participants with more theater than substance while the U.S. consumer tunes them out, keeps spending and keeps the U.S. economic fundamentals on track.”
The jobs report will likely give the Federal Reserve justification to lower short-term interest rates by a modest 25 basis points, rather than making a deeper cut, when policymakers meet in mid-September.
Fed Chairman Jerome Powell is slated to discuss the economic outlook in a speech later Friday in Zurich.
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