August Jobs Rise 169K, Less Than Expected, Unemployment Rate 7.3%, Huge Downward Revision To July Print
A messy report out of the gate with the number of jobs added in August at 169K, or as predicted by ADP, worse than the 180K expected, however this was offset by the Unemployment Rate dropping from 7.4% to 7.3%, on expectations of an unchanged print. However what has shocked the market is the revision to the July jobs number from 162K to only 104K, resulting in a net drop of 74K jobs, and breaking the average 2013 jobs gain of 200K which previously was said by the Fed to be the key threshold level for tapering. The question now is: is this print bad enough to delay the taper?
From the report:
Total nonfarm payroll employment increased by 169,000 in August, about in line with the average monthly gain of 184,000 over the prior 12 months. In August, job growth occurred in retail trade and health care, while employment in information declined. Employment continued to trend up in food services and drinking places, professional and business services, and wholesale trade. (See table B-1.)
Retail trade added 44,000 jobs in August and has added 393,000 jobs over the past 12 months. In August, job growth occurred in clothing stores (+14,000), food and beverage stores (+12,000), general merchandise stores (+9,000), and electronics and appliance stores (+4,000).
Employment in health care increased by 33,000 in August. Within the industry, most of the job growth occurred in ambulatory care services (+27,000).
In August, employment in professional and business services continued to trend up (+23,000). Over the past 12 months, this industry has added 614,000 jobs. Employment in temporary help services changed little in August.
Within leisure and hospitality, employment in food services and drinking places continued to trend up in August (+21,000). Over the year, food services and drinking places has added 354,000 jobs.
In August, wholesale trade employment continued to trend up (+8,000). This industry has added 83,000 jobs over the past 12 months.
Within manufacturing, employment in motor vehicles and parts rose by 19,000 in August, after declining by 10,000 in July. Auto manufacturers laid off more workers for model changeover in July than in recent years. The return of laid-off workers contributed to the increase in August. Over the past 12 months, auto manufacturers have added 34,000 jobs.
Within information, the motion picture and sound recording industry lost 22,000 jobs in August, following a gain of 8,000 in July.
Employment in other major industries, including mining and logging, construction, transportation and warehousing, financial activities, and government, showed little or no change in August.
The average workweek for all employees on private nonfarm payrolls increased by 0.1 hour in August to 34.5 hours. In manufacturing, the workweek increased by 0.1 hour to 40.8 hours, and overtime increased by 0.2 hour to 3.4 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was unchanged at 33.6 hours. (See tables B-2 and B-7.)
In August, average hourly earnings for all employees on private nonfarm payrolls rose by 5 cents to $24.05. Over the year, average hourly earnings have risen by 52 cents, or 2.2 percent. In August, average hourly earnings of private-sector production and nonsupervisory employees rose by 4 cents to $20.20. (See tables B-3 and B-8.)
The change in total nonfarm payroll employment for June was revised from +188,000 to +172,000, and the change for July was revised from +162,000 to +104,000. With these revisions, employment gains in June and July combined were 74,000 less than previously reported.
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