US economy adds 130,000 new hires as unemployment rate holds at 3.7%
Friday, September 06, 2019
In August, U.S. nonfarm payrolls added 130,000 total new hires versus 164,000 in July as the unemployment rate held at 3.7%, according to the Bureau of Labor Statistics. There were 6 million unemployed workers in August compared with 6.1 million in July.
In August, there were scant or no changes to the jobless rates for men, women, blacks, Hispanics, whites, adults and teens from July. The employment-to-population ratio rate edged up to 60.9% versus 60.7% in July, the BLS reported.
Workers’ wages rose, in keeping with a near-50-year low unemployment rate of 3.7% over the past three months. "In August, average hourly earnings for all employees on private nonfarm payrolls rose by 11 cents to $28.11," according to the BLS, "following 9-cent gains in both June and July. Over the past 12 months, average hourly earnings have increased by 3.2%."
Leading job creators were midsize employers (50-499 employees), hiring 77,000 new workers in August versus 67,000 in July. Small-business hiring (payrolls of 1-49 employees) grew 66,000 jobs in August from 11,000 in July, according to the Automatic Data Processing (ADP) National Employment Report.
Very small businesses of 1-19 employees added 26,000 new jobs in August after average monthly job losses of 18,333 for April-June. There were 52,000 new hires at large firms (500 or more workers) in August, down from 78,000 workers in July.
The ADP National Employment Report comes from ADP’s nonfarm private sector payroll data representing 411,000 U.S. clients and nearly 24 million employees (out of a labor force of 157 million), published in alliance with Moody's Analytics.
According to ADP/Moody’s report, the service-providing sector continued to dominate job creation, adding 184,000 new hires in August versus 146,000 in July. Payrolls in the goods-producing sector inched up to 11,000 new jobs in August versus 9,000 in July. Manufacturing firms led the goods-producing sector with 8,000 new hires in August versus 1,000 in July.
Ahu Yildirmaz is vice president and co-head of the ADP Research Institute. "In August we saw a rebound in private-sector employment," she said. "This is the first time in the last 12 months that we have seen balanced job growth across small, medium and large-sized companies."
The U.S.-China trade war is slowing economic growth in both nations. U.S. farmers are going out of business, according to FoxBusiness.com.
The growth in U.S. gross domestic product, a comprehensive measure of economic activity, fell to 2.1% for the second quarter of 2019 versus 3.1% for the first quarter of the year. To counter slowing GDP growth, the Federal Reserve Bank has cut short-term interest rates to stimulate economic activity, e.g., lending and spending.
The economic expansion since the Great Recession ended in mid-2009 continues. However, economic headwinds persist.
For instance, the growing U.S.-China trade war is hiking prices through increased tariffs, or taxes, on American consumers and businesses. The upward spike of prices should become more apparent in the last quarter of 2019. It is hard to see how that change would improve job creation.
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