Employment Situation: Hurricane Masks Another Solid Report
October 5, 2018
Bottom Line: September saw below average job growth with net declines in the retail and leisure and hospitality sectors, likely impacted by the hurricane in the mid-Atlantic. There were strong revisions to August and July data, though, as both private and government sector jobs were revised higher. Average hourly earnings were in-line with expectations and revised a touch lower in prior months -- but we are still seeing a modest acceleration there with 3-month annualized gains of 3.8% vs. 2.8% over the last 12 months and 2.6% in 2017. That said, we are not seeing that confirmed in average weekly earnings, where 3-month annualized gains are still just in-line with 2018's gains at 2.6%. Finally, the household jobs survey showed strong gains of 420k, pushing the unemployment rate down to 3.7% with the labor-force participation rate unchanged at 62.7%. Overall, adjusted for the hurricane impact this was another solid report, mostly in-line with those of the last few months.
Payroll Employment rose by 134k in September, compared with market expectations for an increase of 185k. The prior 2 months were revised, higher in August by 69k and higher in July by 18k.
Government jobs ROSE by 13k. Consequently, private sector jobs ROSE by 121k. Private education jobs fell by 12k. State and Local education jobs rose by 20k. Overall employment is now 1.7% ABOVE its year ago level, Over the past 12 months, 2,537k jobs have been created.
In September, the job gains were in:
- Trade, Transportation & Utilities (+28k with -20k of those in Retail Trade),
- Professional & Business Services (+54k with the addition of 10.6k in Temp Help Services),
- Education & Health Services (+30k),
- Construction (+23k),
- Manufacturing (+18k), and
- Financial Activities (+13k)
- Jobs were shed in Other Services (-1k), and Leisure & Hospitality (-17k).
Article by
Contingent Macro Advisors