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Labor Market
The US unemployment rate remained unchanged in September, and the number of jobs added exceeded that of August.
The Bureau of Labor Market Statistics released new labor force participation data, employment statistics for various industries, average hourly earnings, and other labor market figures on Friday.
According to the Bureau of Labor Statistics report, the US added 336,000 jobs in September based on nonfarm payroll employment growth. This figure significantly surpassed the expected gain of 170,000 and exceeded the revised August growth of 227,000. The preliminary estimate for August was 187,000, as reported at the beginning of September.
Acting Secretary of Labor Julie Su expressed confidence in the economy, stating, “The economy is strong, and an economy that benefits working people is the best kind we can build. This is a robust report, indicating stability, steady growth, and our commitment to ensuring that all Americans share in this prosperity.”
The July payroll gain was revised from 157,000 to 236,000, according to the latest release from the Bureau of Labor Statistics.
Nick Bunker, economic research director for North America at the Indeed Hiring Lab, noted, “When examining the trends, it becomes evident that the labor market remains resilient and exhibits sustainable and enduring strength.” He also highlighted the strong payroll gains, particularly when compared to the necessary numbers to keep up with population growth.
Julia Pollak, chief economist for ZipRecruiter, remarked on the remarkable aspect of continued job growth, even in industries sensitive to interest rates, such as manufacturing and construction.
Leisure and hospitality experienced robust job growth in September, with an increase of 96,000 jobs. Government employment also surged by 73,000, with more significant gains at the local and state government levels compared to federal government job growth.
The information sector, however, saw a loss of 5,000 jobs.
The news release attributed this decline to employment in motion picture and sound recording industries, which has trended downward, primarily due to labor disputes.
After an uptick in the unemployment rate in August due to increased labor force participation, the unemployment rate remained at 3.8% in September, slightly higher than the forecasted 3.7%.
Similarly, the labor force participation rate remained steady at 62.8% in September, and the employment-to-population ratio held at 60.4%.
Average hourly earnings increased by 4.2% year over year and 0.2% month over month, with average hourly earnings reaching $33.88 in September. Both month-over-month and year-over-year growth rates have been slowing, which aligns with the Federal Reserve’s efforts to combat inflation.
Nick Bunker noted, “Wage growth is moderating and moving in a direction similar to pre-pandemic levels, which is more sustainable.”
Recent data also showed 3.6 million resignations in August, accompanied by a rise in job openings to 9.6 million. Bunker cautioned about the monthly increase in job openings, stating that the majority of the increase came from the professional and business services industry, which may not be indicative of a broader resurgence.
Nonetheless, the latest job data is encouraging news for those concerned about a potential economic downturn. “The labor market remains resilient, bringing us one step closer to getting through 2023 without the predicted recession,” noted Daniel Zhao, lead economist at Glassdoor.
In summary, despite some adjustments in the labor market dynamics, workers still possess a degree of influence in the current job market, according to Karin Kimbrough, LinkedIn’s chief economist.
Kimbrough acknowledged a rebalancing occurring, with a slight shift towards employers having more leverage us.
Karim Kimbrough added further insights, saying, “Currently, many workers are adapting to the realization that the terms they could command a year and a half ago may not be the same as those they can demand now.” This shift suggests an evolving balance favoring employers to some extent.
Despite the ongoing adjustments in the labor market, the latest data underscores the resilience of the US economy. It indicates that the nation is moving closer to avoiding the predicted recession in 2023, largely due to the continued strength of the job market.
Furthermore, the sustained growth in various industries, including manufacturing, construction, and government employment, showcases a diverse and stable employment landscape. This diversity contributes to the overall economic stability, reducing vulnerability to economic shocks in specific sectors.
The moderate wage growth is also a positive sign, aligning with the Federal Reserve’s goals to maintain inflation at manageable levels.
This steadiness in wage growth suggests that the US economy is moving toward a sustainable and predictable trajectory.
As the labor market evolves and rebalances, it presents both challenges and opportunities for workers and employers. Job seekers may need to adapt their expectations and skills to meet the changing demands of the labor market. Employers, on the other hand, may find opportunities to attract and retain talent in this evolving landscape.
In conclusion, the September labor market report demonstrates the US economy’s resilience and ability to adapt to changing circumstances. It provides a positive outlook for the nation’s economic prospects, with strong job growth and signs of stability. As the labor market continues to evolve, it remains essential for both individuals and businesses to stay flexible and responsive to emerging trends and opportunities.
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