In the US, fewer jobs were created last month than expected – but unemployment has fallen significantly. President Biden is making progress.
The US labor market sent mixed signals in September. While the job creation fell well short of expectations, the unemployment rate fell significantly to 4.8 percent and hourly wages rose sharply.
Outside of agriculture, 194,000 employees were added, the Department of Labor announced on Friday in Washington. Analysts had expected an average increase of 500,000 jobs.
However, the employment trend is not quite as weak as it looks at first glance. Finally, the figures were revised upwards by a total of 169,000 digits in the two previous months. The employment figures are generally very susceptible to corrections.
US President Joe Biden pointed out on Friday that the unemployment rate had fallen below five percent for the first time since March last year – at that time the pandemic and the accompanying economic crisis in the USA had picked up speed. Since taking office in January, a total of almost five million jobs have been created. Biden said he would like to see faster progress as his investment projects stalled because of opposition in Congress. “However, we are continuously making progress.”
Unemployment rate fell 0.4 percentage points
Dirk Chlench, economist at Landesbank Baden-Württemberg, believes it is possible that the increase in employment will also be revised upwards in the next few months. Finally, the household survey and the latest report by the labor market service provider ADP would point to a job creation of more than 500,000 jobs in September. The employment figures are determined through a survey of companies and the unemployment rate through a household survey.
The unemployment rate fell compared to August by 0.4 percentage points to 4.8 percent. Analysts had expected a much smaller decline to 5.1 percent. According to the ministry, the number of unemployed fell by 710,000 to 7.7 million. That is significantly fewer unemployed than was recorded after the corona pandemic attacked the United States. The pre-crisis level has not yet been reached: In February 2020 the unemployment rate was 3.5 percent. That corresponded to about 5.7 million unemployed.
The wage development was also stronger than expected. The average hourly wages increased by 0.6 percent compared to the previous month. Analysts had expected an average increase of 0.4 percent. Compared to the same month last year, hourly wages rose by 4.6 percent.
According to Chlench, the decline in the unemployment rate and the accelerated rise in hourly wages suggest that the US Federal Reserve will soon begin to exit its very loose monetary policy, as it has signaled. The reactions on the financial markets were therefore limited. The euro initially gained against the US dollar. However, he gave most of his profits back. On the US bond market, prices rose somewhat. The rashes were limited. The bottom line was that the stock markets hardly reacted.
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
