Unemployment in the US fell slightly to 7.3% in July, its lowest level in over four years, but the sluggish pace of recovery continued as the economy added just 169,000 new jobs. The latest nonfarm payroll figures come at a crucial moment for the Federal Reserve, which is weighing when and whether to cut its $85bn-a-month economic stimulus programme, known as quantitative easing (QE). Fed chairman Ben Bernanke has tied cuts in QE to the health of the job market. The Federal Reserve open markets committee (FOMC), which is split on when to pull back on the QE programme, meets on September 17-18. The jobless rate has now fallen from 8.1% a year ago but the pace of job creation remains slow and the Labor Department revised down its numbers for the previous two months after concluding job growth was less than expected. The US added jobs in retail, healthcare, food services and drinking places, professional and business services and wholesale trade in August, said the bureau of labor statistics. The number of long-term unemployed (those jobless for 27 weeks or more) was largely unchanged at 4.3m, these individuals accounted for 37.9% of the unemployed. Unemployment for teenagers remained extremely high at 22.7% and for black people, at 13%, and Hispanics, at 9.3%. The number of people not in the workforce in August rose to 90.47m, from 89.95m in July. Republican house speaker John Boehner called the figures mediocre. Gus Faucher, senior economist at PNC Bank said they were disappointing. Its not just the headline number, its also the downward revisions to the previous months. The unemployment rate fell but for the wrong reasons, less people are participating in the labour force. Junes nonfarm payroll figure was revised down from 188,000 to 172,000 and July was revised from 162,000 to 104,000. The revisions mean the US added 74,000 less jobs in June and July than previously reported. The labour market is not as strong as we had previously thought. I think this means the Fed is less likely to taper off QE when it meets later this month, said Faucher. On Thursday payroll company ADP said US businesses added 176,000 jobs in August, fewer than in June and July but in line with economists expectations. Companies in all industries and of all sizes hired in August, ADP said, with professional and business services firms adding 50,000 jobs. Manufacturers created 5,000, reversing a drop in July, and construction firms added 4,000. Mark Zandi, chief economist of Moodys Analytics, which helps compile ADPs report, said: It is steady as she goes in the job market. Job gains in August were consistent with increases experienced over the past two-plus years. There is little evidence that fiscal austerity and healthcare reform have had a significant impact on the job market. Article history Business US economic growth and recession · US economy · US unemployment and employment data · Unemployment and employment statistics · Federal Reserve · Quantitative easing World news United States More news More on this story US non-farm payrolls - as it happened Data comes in below consensus forecast of 180,000, while previous estimates for June and July have been revised down Share
Posted on: Sun, 10 Nov 2013 22:24:54 +0000
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