OCTOBER 11, 2021 – JOBS NUMBERS DISAPPOINT WHILE UNEMPLOYMENT FALLS
The US economy added 194,000 new jobs in September, the slowest gain of this year, while the unemployment rate fell to 4.8 percent as many workers stopped looking for work.
The delta variant of the corona virus is putting a damper on economic growth. The 194,000 new jobs are the smallest gain since December 2020 and down 46 percent from August’s number of 366,000. Workers have been leaving the workforce, pushing the unemployment rate down from 5.2 percent in August to the current 4.8 percent. The spread of the delta variant has caused restrictions to be placed on some businesses, some workers are too scared to seek employment while others have opted for early retirement.
Even though the unemployment rate is still above the pre-pandemic 3.5 percent, wage growth indicates the labor market is tight. Hourly wages rose 0.6 percent in September from August as employers sought to entice workers. Higher wages could add to inflation pressures, and this will put pressure on the Fed to tighten monetary policy. The Fed meets next on November 2-3.