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03/29/2024 06:09:11 am

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September US Jobs Report Strong But With Some Worrisome Signs

Jobs report

(Photo : Reuters) September's jobs report was strong but also contained some troubling signs.

With nearly 250,000 jobs created in September following a disappointing August jobs report, the Bureau of Labor Statistics Friday said unemployment has fallen to just less than 6 percent. Wall Street responded with rising stock prices when the job news was announced.

The bounce in job growth from only 180,000 jobs created in August and a better 243,000 jobs created in July, also came with some mixed news. Labor force participation had dropped to just less than 63 percent, its lowest level since early 1978.

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Another troubling factor was the lack of growth in worker wages. Hourly wages essentially were flat in September, actually falling by one cent, after growing by a minuscule 2 percent in the last 12 months. The underemployment rate reflecting workers settling for part-time jobs or giving up their job search fell to just under 12 percent, down a tick from August.

Generally, wages grow when job numbers grow because employers need to pay more to attract better-trained workers. That linkage has broken down in this economy, which may mean trouble since workers with stagnant wages tend to cut down on spending and that spending drives future economic growth.

Still, the jobs report showed continued momentum in the private economic sector that has averaged 200,000 new jobs a month since the start of the year. Analysts said job growth was strong across all sectors of the economy, indicating employers were more confident that the economy would keep growing.

The September jobs report bettered all forecasts by economists while the drop in unemployment was greater than expected as well. Forecasts had called for about 215,000 new jobs and unemployment holding at just over 6 percent.

Fed Chair Janet Yellen said the job numbers were good, but economists were troubled by the large number of people who wanted to work full-time and couldn't find those types of jobs.

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