US added 29,000 jobs in September as unemployment rose to 4.2%
Victoria Shinder1 min readThe US economy added 29,000 jobs in September, according to the Bureau of Labor Statistics report released on 2 October, well below the consensus forecast of 90,000, CoinDesk reports. The unemployment rate rose to 4.2%, against expectations and an August reading of 4.1%. The same figures were reported by Reuters, CNBC and others.
The revisions made the picture weaker. August's gain was cut to 133,000 from an originally reported 162,000, and July's previously reported gain of 21,000 became a loss of 10,000. Average hourly earnings rose 0.1% on the month, short of forecasts for 0.3% and August's 0.3%, and were up 3% on the year against expectations of 3.2% and August's 3.1%.
Markets read the report as a reason for the Federal Reserve to pause. According to CoinDesk, the 10-year Treasury yield fell 7 basis points to 5.17% and the 2-year yield by a similar margin to 4.71%, gold rose more than 1%, the dollar fell against major currencies, and stock index futures added to gains.
The data land two weeks after the Fed raised its target range by a quarter point to 3¾ to 4%. Vice Chair Philip Jefferson said on 1 October that he saw unemployment of 4.1% in August as near maximum employment and the risks to employment as roughly balanced, while inflation remained too high, and that any further adjustments would depend on the data.
Why it matters
A hiking cycle driven by an energy shock depends on the labour market holding up. Three months of payroll figures revised down and a rise in unemployment give the doves an argument to pause; slowing wage growth also takes some pressure off the services inflation the Fed has been worried about.