American labor market is weak with low job growth and rising unemployment
In August, the US job growth rose rapidly, while the unemployment rate rose by nearly four years high 4.3 percent, confirming that the labor market situation was softening the case for cutting interest rate from the Federal Reserve this month.
The employment report of the Labor Department on Friday also showed that the economy had lost the job in June for the first time in four and a half years. Economists who reduce the wide import tariff of US President Donald Trump and an immigration crack have reduced the labor pool.
The tenderness in the labor market is mostly coming from the hiring side. The Kovid -19 had more unemployed people than vacancies in July for the first time in July.
Trump’s duties, which have extended the country’s average tariff rate to the highest level since 1934, stopped the possibility of high inflation, inspiring the US central bank to stop its interest rate cut cycle. The way some uncertainty on trade policy was now starting to rise with most tariffs, an American appeal court last Friday ruled that many duties were illegal, which kept businesses in a state of flow.
Olu Sonola, head of US Economic Research in Fitch rating, said, “A month ago, the warning of the warning in the labor market was just loud.” “Fed is likely to prioritize the stability of the labor market on its inflation mandate, even inflation moves beyond the target. It is difficult to argue that tariff uncertainty is not a major driver of this weakness.”
Statistics come as Canada’s own job data, indicating trouble in the labor market. August saw the unemployment rate in Canada up to 7.1 percent, and the economy blew 66,000 jobs.
The Labor Statistics Bureau of the Bureau of Labor Department said that only 22,000 jobs in non-agricultural payroll in the US increased last month, which was revised to 79,000 in July, said the Bureau of Labor Statistics of the Labor Department.
Economists voted by Reuters had estimated parole in July after a pre -reported benefit of 73,000. For 144,000 posts, estimated estimated estimates without any job.
The amendment also showed that 13,000 jobs declined in June, the first decline since December 2020, rather than 14,000, as reported last month.
In July, the unemployment rate increased from 4.2 percent to more people entering the labor force.
Last month, some fast job growth recession can be tied to a seasonal bizarre. The early August job is counted to demonstrate a weak bias, which is later visible. However, in the same period in 2024, the employment growth of 29,000 jobs per month in the last three months has softened.
In August, the wholesale of jobs added was in health care, with payroll 31,000 in the sector. But even this pillar of the labor market is showing stress as the increase was less than an average monthly profit of 42,000 in the last 12 months.
Employment in the social aid industry increased by 16,000 posts. This week, government data showed the open-to-back fall in July as the open-to-back fall of health care and social aid jobs.
The federal government fell to payroll to be reduced by 15,000, and the employment in that region has reduced by 97,000 since January. A sharp decrease in October is expected in October after collecting payments from parole in the East month in October.
Job loss occurred in many fields including wholesale trade, manufacturing, construction and professional and professional services.
“This is a disappointing job number, but I hope it is going to modify,” the White House Economic Advisor Kevin Haset told CNBC after releasing the employment report.
Fed Chair Jerome Powell indicated a rate cut in the September 16-17 policy meeting of the US Central Bank last month, acknowledging the rising labor market risks, but also stated that inflation remained a threat. Fed has kept its benchmark interest rate overnight in the range of 4.25 percent to 4.50 percent since December.
American Treasury yields fell on data. There was a decline against a basket of dollar currencies.
US President Donald Trump fired the Commissioner of Labor Statistics, Erica McAinter, after a report was very weak after hiring slow in July and earlier in May and June.
Trump last month fired the Commissioner of Labor Statistics, Erica McAinter, accused him, without proof, to manipulate employment data. After amendment for the payroll count for May and June after amendment.
But economists have defended MCENTARFER and blamed the model of “birth-and-death” model, a method that tries to guess the use of bureau of labor statistics how many jobs were received or lost due to opening or closing companies in a given month.
“We are in a low-churn labor market, in which not hiring or firing is not happening too much. This means increase in jobs
See do see mainly inspired by the net birth of new firms in the economy, “said Ernie Tedchi, director of economics at the budget lab at Yale University.
“But it is just the most imposed part. It is the most sensitive to the amendment as it is the result of clear modeling by BLS, rather than that they can surveys.”
Trump has nominated EJ Antony, Chief Economist of Conservative Think-Tank Heritage Foundation to replace MCENTARFER. Antony, who wrote pieces of critical opinion of the bureau and even suggested suspending the monthly employment report, is considered unqualified by economists in large -scale political ideologies.
