U.S. Jobs Rise While Unemployment Drops, Keeping Pressure On Fed
(Bloomberg) -- US hiring continued at a solid, yet more moderate pace last month and the unemployment rate fell, indicating the labor market remains tight and has so far proven resilient to steep interest-rate hikes by the Federal Reserve.
Nonfarm payrolls increased 263,000 in September -- the smallest monthly advance since April 2021 -- after a 315,000 gain in August, a Labor Department report showed Friday. The unemployment rate unexpectedly dropped to 3.5%, and average hourly earnings rose firmly.
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The median estimates in a Bloomberg survey of economists called for a 255,000 advance in payrolls and for the unemployment rate to hold at 3.7%.
The figures are the latest illustration of the perennial strength of the US job market. While there have been some indications of moderating labor demand -- most notably a recent decline in job openings -- employers, many still short-staffed, continue to hire at a solid pace. That strength is not only underpinning consumer spending but also fueling wage growth as businesses compete for a limited pool of workers.Â
The Fed, meanwhile, is hoping to see a significant softening in labor market conditions, with the goal of cooling wage growth and ultimately inflation.
Stock futures fell and Treasury yields rose as the strong report reaffirmed bets that the central bank will continue to be aggressive with its tightening campaign.
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