Interest Rates, Payroll, Unemployment, Federal Reserve
In the monthly jobs report for August that the Bureau of Labor Statistics just released, the number of payroll jobs grew by just 22,000 jobs. This is well below economist expectations of an increase of 75,000, which is now considered the break-even rate to keep unemployment steady.
Most sectors showed mildly contracting payrolls, and only three showed significant growth: health care (up 31,000), social assistance (up 16,000), and leisure/hospitality (up 28,000). Even the increases in health care and social assistance are smaller than those we have seen in recent months or years.
Federal employment continued to drop (by 15,000) last month, and it has declined by nearly 100,000 since January; more declines are expected in the coming months as workers leaving the government switch from severance pay (where they are still counted as employed) to unemployment. Employment in professional services, which has also been affected by cuts in federal contracts and research grants, dropped by 17,000 last month and by over 50,000 in the past three months.
