WASHINGTON (MNI) - The U.S. August employment report was modest at best and certainty far worse than hyped-up expectations, suggesting further moderate economic growth ahead.
August payrolls were up 169,000 but the July-June revisions were -74,000 in total, offsetting some of the good news. July's downward revision in jobs was in government, transportation and manufacturing jobs. There is a tendency for August jobs to get revised higher over time, but that future event cannot be expected.
With the July-August average at +137,000 jobs, there has been a deceleration from the +182,000 average of Q2 and the +184,000 average for the prior twelve months.
The 0.1 point dip in the unemployment rate, to a still high 7.3%, reflected a drop in the labor force and less participation. Labor force participation at 63.2% is a low since 1978 and -0.3 point from last August.
Hours rose and earnings rebounded five cents for +2.2% over the year, suggesting higher production and income ahead. But some of the gains reflected catchup after a weak July.
Payroll composition remained skewed towards lesser jobs: manufacturing was +14,000, construction flat, and finance -5,000, but retail was +44,000, restaurants +22,200, health +32,700, and temporary jobs +43,000. Government was +17,000 as local education posted +20,100.
A bottom line from this report is that modest growth in the +2% area continues.
