U.S. employers added a modest 130,000 jobs in August, a sign that hiring has slowed but remains durable amid economic weakness and President Donald Trump’s trade war with China.
The job gain was boosted by the temporary hiring of 25,000 government workers for the 2020 Census. Excluding all government hiring, businesses added just 96,000 jobs, the fewest since May.
The Labor Department reported Friday in its monthly jobs report that the unemployment rate remained 3.7%, near the lowest level in five decades. The jobless rate was flat for a positive reason, though: Americans surged into the workforce, lifting the proportion of adults who are either working or looking for work to its highest level since February.
And average hourly pay rose 3.2% from a year earlier, outpacing inflation and lifting Americans’ spending power.
Job gains from the previous two months were revised lower by a combined 20,000. That lowered average job growth to 150,000 a month for the past six months, down from 223,000 for all of last year. Hiring at that pace is enough to keep up with population growth and lower the unemployment rate over time.
The rate of job creation is significant because at a time when the economy has been slowing, additional steady hiring — and higher pay — can continue to fuel consumer spending, the primary driver of growth. Unlike consumers, many businesses have slowed their spending and delayed expansion and investment given their uncertainty about the duration and impact of the trade war. In addition, retaliatory tariffs from China have cut into U.S. exports.
For now, Americans are still spending and keeping the economy moving. Consumer spending rose in the April-June quarter by the most in five years. It had also increased at a healthy clip in July.
The unemployment rate for African-Americans fell to 5.5%, a record low. Trump has repeatedly highlighted that decline, which has been steady since the Great Recession ended in 2009. In August, however, the rate fell because more African-Americans stopped looking for work and were no longer counted as unemployed.
Consumers generally feel positive about the economy despite some cautionary signs. Their confidence, as measured by the Conference Board, is still strong. But an index of sentiment compiled by the University of Michigan fell in August by the most in nearly seven years. In that survey, Americans expressed rising concern about the consequences of tariffs.
U.S. and Chinese officials plan to meet in early October in negotiations that are intended to resolve their dispute. The announcement Thursday of next month’s resumption of talks helped ignite a rally on Wall Street.
The impact of the trade war is evident in industry-specific hiring figures. Manufacturers added just 3,000 jobs, the latest sign their hiring has fallen off sharply from last year. Employment in shipping and warehousing companies was essentially unchanged, with fewer factory and farm goods to transport. Retailers cut 11,000 jobs, the seventh straight month of decline, which is partly a reflection of the impact of online shopping.
As the tariffs increasingly take effect, trucking companies could absorb a hit if they have fewer factory and farm goods to ship. And retailers might cut workers as tariffs start to affect such consumer goods as clothes, toys, and electronics. If setbacks in those industries become severe enough, they could eventually raise the unemployment rate.
(AP)
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One Response
A commen misconception is that these jobs are because of trump, but really this is in spite of him. He has done nothing to help the job market but instead, he actually he has done all he can to stunt the growth of the economy of this nation. An ongoing trade war with no end in sight and a feeling of instability about foreign markets has only served to damage our once invincibility as the worlds strongest economy. All this remains as Trump’s legacy to the future; to be known as the one who divided a united country, and who crippled the most powerful country in the world.