Employers Add Fewer Jobs than Forecast in September
WASHINGTON -- U.S. employers added far fewer than expected workers in September, suggesting a loss of momentum in the economy that supported the Federal Reserve's decision to maintain its monthly bond purchases.
Nonfarm payrolls increased 148,000 last month, the Labor Department said Tuesday. While the job count for August was revised to show more positions created than previously reported, employment gains in July were the weakest since June 2012.
But there was some silver lining in the report, with the unemployment rate dropping a tenth of a percentage point to 7.2 percent, the lowest level since November 2008.
The jobless rate is derived from a separate survey of households, which showed an increase in employment last month.
The closely watched monthly employment report was released more than two weeks later than originally scheduled because of the partial shutdown of the federal government earlier this month.
Signs the economy lost steam even before the budget fight could rattle financial markets. government shutdown shaved as much as 0.6 percentage point off annualized fourth-quarter gross domestic product, through reduced government output and damage to both consumer and business confidence.
Officials at the Federal Reserve are likely to hold off any decision on scaling back the U.S. central bank's bond buying until the extent of the economic damage from the budget fight is clearer.
Fed officials will meet next week to discuss monetary policy, on Oct. 29-30. They surprised markets last month by sticking to their $85 billion per month bond-buying pace, saying they wanted to see more evidence of a strong recovery.
Economists fear that lawmakers will engage in another bruising round early next year when Congress must agree on a budget to fund the government and once again raise the nation's borrowing limit.
The pattern of employment gains in September was mixed last month, with government payrolls increasing 22,000 jobs after rising 32,000 in August.
The leisure and hospitality industry shed the most jobs since December 2009. There was a small bounce in information sector payrolls, which dropped in August as the motion picture industry shed workers.
Construction payrolls increased 20,000, which could ease fears of a leveling off in home building.
Manufacturing sector added only 2,000 jobs, while retail employment increased 20,800.
Other details of the employment report were mildly encouraging, with average hourly earnings increased three cents in September. The length of the average workweek held steady at 34.5 hours.
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