Reflecting the impact of Hurricanes Harvey and Irma, the Labor Department released a report on Friday showing an unexpected decrease in employment in the U.S. in the month of September.
The report said non-farm payroll employment fell by 33,000 jobs in September after climbing by an upwardly revised 169,000 jobs in August.
The modest decrease surprised economists, who had expected employment to rise by 90,000 jobs compared to the addition of 156,000 jobs originally reported for the previous month.
The Labor Department said a sharp decline in employment in food services and drinking places and below-trend growth in some other industries likely reflected the impact of the hurricanes.
Despite the unexpected drop in employment, the unemployment rate dipped to 4.2 percent in September from 4.4 percent in August. Economists had expected the unemployment rate to hold at 4.4 percent.
With the unexpected decrease, the unemployment rate fell to its lowest level since hitting a matching rate in February of 2001.
The drop in the unemployment rate came as the household survey measure of employment showed a spike of 906,000 people, while the labor force increased by 575,000 people.
The report also showed a notable acceleration in the pace of wage growth, as average hourly employee earnings were up by 2.9 percent year-over-year in September compared to 2.5 percent in August.
Paul Ashworth, Chief U.S. Economist at Capital Economics, said the 0.5 percent monthly increase in wages came as many low-paid restaurant workers were temporarily out of a job.
"Overall, the Fed and the markets will just ignore this report," Ashworth said. "If past-storms, particularly Katrina, are any guide, employment will rebound markedly over the next few months."
He added, "The drop in the unemployment rate might persist, however, with consumer and small business surveys both pointing to a drop in the unemployment rate to nearer 4% for some time."
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Economic News
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.
