JOBS REPORT STUNNER: US economy creates 336,000 jobs in September, nearly twice the number expected

[Anta Assamey]

The US economy added 336,000 jobs in September, highlighting concern that the labor market isn't cooling as fast as the Federal Reserve would like in its battle against inflation.

The nonfarm payroll additions were nearly double the 170,000 economists surveyed by Bloomberg had expected. Revisions to the August and July jobs reports released Friday showed there were 119,000 more jobs created during those months than previously reported, according to data from the Bureau of Labor Statistics.

In September, the unemployment rate remained flat at 3.8%, unchanged from August, and at a level not seen since February 2022.

"Today's report was unequivocally strong," Morgan Stanley chief US economist Ellen Zentner wrote in a research note on Friday. "Too strong for policymakers to relax their tightening bias. Inflation has been decelerating faster than Fed forecasts, but continued strength in job gains will fuel doubts that the pace of deceleration in inflation will be sustained."

Wages, a closely watched indicator of how much leverage workers have, rose less than expected last month, rising 0.2% on a monthly basis and 4.2% over last year. Economists expected wages to rise 0.3% over last month and 4.3% over last year.

The labor force participation rate increase remained unchanged at 62.8%, the highest level since February 2020. Average weekly hours also remained flat at 34.4.

September saw the highest monthly job total since January, driven by various industries. The largest increases in Friday's data were seen leisure and hospitality, where 96,000 jobs were added. Employment in food services and drinking places rose by 61,000, reaching its pre-pandemic level.

Government employment increased by 73,000 while health care added 41,000 jobs.

 

MIAMI, FLORIDA - OCTOBER 02: Construction workers build a residential high rise on October 02, 2023 in Miami, Florida. According to the Census Bureau, apartment building starts fell to a seasonally adjusted annual rate of 334,000 units in August, marking a 41% decline from the pace seen the same month a year prior. (Photo by Joe Raedle/Getty Images)

 

The labor market has been a key factor in the Federal Reserve's read of the economy, which remains in focus ahead of the central bank's next policy meeting on November 1.

[Anta Assamey]