Manufacturing Loses 1000 Jobs in September While Durable Goods Gain

Gary Hershorn  Getty Images

Gary Hershorn Getty Images

The Bureau of Labor Statistics said USA payrolls declined by 33,000 in September.

United States non-farm payrolls declined 33,000 for September compared with expectations of a gain around 85,000 for the month and this was the first reported decline for over seven years. "In September, average hourly earnings for all employees on private nonfarm payrolls rose by 12 cents to $26.55", the report said. The median forecast called for 100,000 jobs to be added in September and the unemployment rate to hold steady at 4.4%.

The jobless rate dropped to 4.2%, the lowest since 2001.

Note that last month wage growth was above trend, as average hourly wages rose 0.5 percent over the month and 2.9 percent over the past year (the yearly trend has been around 2.5 percent). One tidbit of information was that work no-shows - again, directly related to the hurricanes - reached the highest totals in 20 years. The 0.5% monthly increase in earnings may have been distorted by a dip in low-paid employees due to hurricane damage, but the data overall will increase confidence of acceleration and an increase in the inflation rate. Looking at job gains by industry in September, the leisure and hospitality industry lost a striking 111,000 jobs in September.

U.S. employment fell in September for the first time since 2010 as hurricanes Harvey and Irma took their toll on the jobs market.

Ian Shepherdson of Pantheon Macroeconomics said: "Unemployment is what matters, and this report therefore makes a December rate hike even more likely". The number of unemployed persons declined by 331,000 to 6.8 million. People are still considered employed even if they missed work and were unpaid as a result. But the government said that figure was artificially inflated by the loss of so many lower-paid workers in hurricane-hit areas. That is the highest level of annual wage growth in more than eight years, and it means some people are getting more in their paychecks.

The storms' effects are easy to detect in the underlying figures. That's equal to about 7.7 percent of the nation's workforce. Summaries from July and August showed impressive growth in the residential construction sector, giving economists a glimmer of hope that an inventory increase was on the way, but Hurricanes Harvey and Irma stifled that growth.

The trio of major hurricanes last month devastated parts of Texas and Florida and all of Puerto Rico, weighing heavily on jobs.

Latest News