The U.S. economy created jobs at a slower pace than anticipated in September, an indicator of a slowing economy, triggered by a sharp decline in government.
Source: U.S. Department of Labor.
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Nonfarm payrolls jumped by 194,000 in the month, compared to a Dow Jones estimate of 500,000. The unemployment rate dropped to 4.8%, better than initially expected for 5.1%.
The headline employment figure was hurt by a 123,000 decrease in government payrolls as private payrolls rose by 317,000. The decline in the jobless rate was reported as the labor force participation rate dropped lower.
A more comprehensive figure that includes discouraged workers and those with part-time jobs for economic reasons dropped to 8.5%, a new pandemic low.
Even though jobs numbers were discouraging, wages rose sharply. The monthly increase in wages of 0.6% contributed to the year-over-year increase to 4.6%.
Leisure and hospitality again contributed to job creation, adding 74,000 jobs. Professional and business services contributed 60,000 as retail jobs rose by 56,000.
The jobs report comes at an important time for the economy, with recent data signaling a mixed performance of solid consumer spending irrespective of soaring prices and rising housing costs.