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Employment Situation: Modest gains with declines in manufacturing

September 2, 2016
Bottom Line: Payroll Employment rose by 151k in August, compared with market expectations for an increase of 180k. There were modest revisions to the previous two months which subtracted a total of 1k jobs. Manufacturing and construction lost 24k jobs, while the reported level of education jobs in public and private schools rebounded only modestly and gains in professional and business services were slower than in July with a notable slip of 3k jobs in temp services. Job creation has averaged 232k over the past 3 months vs. the past 12 months average of 204k. The unemployment rate was unchanged, as household employment grew less than the increase in labor force. Both hourly and weekly earnings rose slightly, less than expected, after a moderate increase in July. The workweek and the 3-month average now 34.6.

Payroll Employment ROSE by 151k in August, compared with market expectations for an increase of 180k. The prior 2 months were revised, higher in July by 20k and lower in June by 21k. Government jobs ROSE by 25k. Consequently, private sector jobs ROSE by 126k. Private education jobs rose by 2k. State and Local education jobs rose by 12k. Overall employment is now 1.7% ABOVE its year ago level, Over the past 12 months, 2,447k jobs have been created.

The Unemployment Rate was UNCHANGED in August at 4.9%, compared with market expectations for a small decline to 4.8%. Household employment rose by 97k while the labor force increased by 176k, resulting in an increase in the number of unemployed of 79k. The Labor Force Participation Rate was UNCHANGED at 62.8%. The Employment-Population Ratio was UNCHANGED at 59.7%.

Hourly Earnings ROSE by 0.1% in August, below market expectations of 0.2%. Hourly earnings are now 1.7% ABOVE their year ago level. Weekly Earnings FELL by 0.2%, the result of the change in hourly earnings and a shorter workweek. Weekly earnings are now 1.5% ABOVE their year ago level. The Average Workweek FELL by 0.1 to 34.3 hours, ABOVE the market consensus at 34.5 hours.
Article by contingentmacro