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Investors cheered and stock futures rose as the weaker-than-expected jobs report all but cemented the possibility of a second interest rate cut.
The U.S. economy added fewer than expected jobs in August.
Here were the key employment figures from August, compared to Bloomberg-compiled estimates:
- Nonfarm payrolls added: 130,000 vs. 160,000 expected
- Unemployment rate: 3.7% vs. 3.7% expected
- Average hourly earnings MoM: 0.4% vs. 0.3% expected
- Average hourly earnings YoY: 3.2% vs. 3.0% expected
July’s employment figure was revised to 159,000, down from the 164,000 positions previously reported. The labor force participation rate ticked higher to 63.2%. The manufacturing sector added 3,000 positions in August.
The retail sector lost 11,000 jobs during the month. Retail payrolls fell for the seventh consecutive month, the longest losing streak since 2009.
Wells Fargo economist Sam Bullard predicted that only 135,000 jobs were added in August. “Monthly job gains have slowed so far this year, yet the underlying pace is still solid enough to promote moderate GDP growth,” Bullard wrote in a note Thursday. “That said, the U.S. labor market is not immune to the deceleration in the pace of overall economic growth we have seen recently, and will ultimately show up in future hiring plans.”