With job growth in the retail and healthcare sectors partly offset by the loss of jobs in the information sector, the Labor Department released a report on Friday showing that U.S. employment rose by less than expected in the month of August.
The Labor Department said non-farm payroll employment increased by 169,000 jobs in August compared to economist estimates for an increase of about 180,000 jobs.
The report also showed a notable downward revision to the pace of job growth in July, with the revised data showing an addition of 104,000 jobs compared to the previously reported increase of 162,000 jobs.
Despite the weaker than expected job growth, the unemployment rate dipped to 7.3 percent in August from 7.4 percent in July. Economists had expected the unemployment to come in unchanged.
With the unexpected decrease, the unemployment rate fell to its lowest level since a matching 7.3 percent in December of 2008.
However, the drop in the unemployment rate was largely due to decrease in the size of the labor force, with the participation rate falling to its lowest level since 1978.
Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "August's Employment Report is a mixed bag that can be used to support an immediate tapering of the Fed's monthly asset purchases or delaying that move until later this year."
"Our best guess is that the cumulative evidence of improvement over the past year will convince a majority of officials that the tapering should begin at the next FOMC meeting in another couple of weeks' time, but we're not going to pretend this is a certainty," he added.
The monthly job growth was partly due to the addition of 44,000 jobs in the retail sector as well as the addition of 38,300 jobs in the healthcare and social assistance sector.
The report also showed that government employment increased by 17,000 jobs in August after falling in the three previous months.
On the other hand, the information sector lost 18,000 jobs due largely to a downturn in employment in the motion picture and sound recording industry.
The Labor Department also said average hourly employee earnings rose $0.05 to $24.05 in August. Compared to the same month a year ago, average hourly earnings are up by 2.2 percent.
by RTT Staff Writer
For comments and feedback: email@example.com