US employment growth slows further in September
US non-farm payrolls increased by 661k jobs in September, missing the forecast of 850k and falling well below August’s figure (revised upwards to 1.489 million), according to the US Labor Department on Friday.
In the last monthly employment report before the November 3 presidential election, figures showed that employment growth in the US continued to weaken after its peak in June, when payrolls jumped by a record 4.78 million jobs.
Unemployment fell to 7.9% in September from 8.4% in August, remaining in a steady descend from April’s peak of 14.7% but partially offsetting weak employment figures.
Average earnings also rose below expectations in September (0.1% vs 0.2% f/c) and downward revised August figure to 0.3%
September’s data showed that employment gains were the smallest since recovery started in May, pointing to a long road ahead for the labour sector to recoup job losses of 22.2 million in March and April – as well as indicating slower growth in the fourth quarter.
The slowdown in recovery in the jobs sector was caused by a diminishing government stimulus, with talks on a new fiscal aid package stalling in Congress.
Economists expect more layoffs and bankruptcies, as well as a possible further decline in employment towards the end of the year if the new support package continues to be delayed.