Strategas Chairman and CEO Jason Treynort discusses the revised CPI, real wage and employment data, and the Harris tax increase plan.
U.S. job growth accelerated in August but fell short of economists' expectations and the unemployment rate remained little changed.
The Labor Department said on Friday that payrolls rose by 142,000 in August, well above the 160,000 increase expected by economists at LSEG.
The unemployment rate also unexpectedly rose to 4.3% in July, the highest level since October 2021, before easing slightly to 4.2% as expected.
The number of jobs added in the past two months was revised down, with June's figure being revised down to 118,000, a decrease of 61,000 from an increase of 179,000, and July's figure being revised down to 89,000, a decrease of 25,000 from an increase of 114,000. The revisions made the July payroll figure, nonfarm payrolls, the lowest since December 2020.
Fed Chairman Powell: 'Time to cut interest rates'
The U.S. Labor Department's August employment report fell short of economists' expectations. (Photo: Spencer Pratt/Getty Images/Getty Images)
Private sector payrolls rose by 118,000 rather than the 139,000 expected, below expectations from LSEG economists. Manufacturing payrolls fell by 24,000 in August, below expectations for employment levels in the sector to remain stable.
Construction employment added 34,000 jobs in August, above the 12-month average of 19,000 monthly gains. Health care employment added 31,000, below the 12-month average of 60,000.
Average hourly earnings for all private nonfarm employees rose 14 cents, or 0.4 percent, to $35.21, bringing the increase over the 12 months through August to 3.8 percent.
The labor force participation rate remained at 62.7% in August, little changed for the year.
The long-term unemployment situation remained little changed in August, with 1.5 million people who have been unemployed for 27 weeks. The long-term unemployed account for 21.3% of all unemployed people.
The number of dual-job workers increased by 65,000 to 8.538 million, while the number of part-time workers increased by 527,000 and the number of full-time workers decreased by 438,000.
Fed's actions have a bigger impact on markets than its words in fighting inflation, study finds
Federal Reserve Chairman Jerome Powell has signaled that the central bank is prepared to cut interest rates when it meets this month. (Photo: Roberto Schmidt/AFP via Getty Images/Getty Images)
Federal Reserve policymakers are closely monitoring the labor market ahead of a planned interest rate cut later this month. Interest rates are at their highest in 23 years, with the benchmark federal funds rate in the 5.25% to 5.50% range, as the central bank tries to tame inflation.
The market expects the Fed to announce a 25 basis point rate cut at its next policy meeting on September 17-18, but new data showing continued weakness in the labor market could strengthen the case for a 50 basis point cut.
| Ticker | safety | last | change | change % |
|---|---|---|---|---|
| SP500 | S&P 500 | 5478.28 | -25.13 |
-0.46% |
| I:Comp | Nasdaq Composite Index | 16966.089312 | -161.57 |
-0.94% |
| Me: DJI | Dow Jones Average | 40776.91 | +21.16 |
+0.05% |
Stock index futures pared losses and bond yields fell, with the 10-year Treasury yield hitting its lowest since June 2023, following the August jobs report. Futures traders had been pricing in a 50 basis point rate cut by the Fed at 52%.
Click here to get FOX Business on the go
“The weaker-than-expected jobs report may bolster supporters of a 0.5 percentage point rate cut on Sept. 18, but the verdict is likely still out,” said Chris Larkin, managing director of trading and investments at Morgan Stanley E*Trade. “In the meantime, markets are likely to be sensitive to other data that suggests the economy is cooling too much.”
