US economy added 119,000 jobs in September, a stronger-than-expected number, even though the unemployment rate increased to 4.4%, up from 4.3% in August.
The government released this key jobs report after a seven-week delay caused by the 43-day federal government shutdown, which had halted data collection.
Economists had expected only 50,000 new jobs. But the report also showed that August’s numbers were weaker than first thought; instead of gaining 22,000 jobs, the economy actually lost 4,000.
Because federal workers were furloughed during the shutdown, investors, businesses, policymakers and the Federal Reserve were groping in the dark about the state of the job market.
The shutdown also means the government will not publish a full jobs report for October, since it could not calculate the unemployment rate. October’s job creation numbers will be released together with November’s report on December 16.
Key takeaways from September report
September report arrives at a time when the economy is sending mixed signals. Hiring has slowed throughout the year due to high interest rates and uncertainty around Trump’s campaign to slap taxes on imports from almost every country on earth.
Yet overall economic growth in mid-2024 was resilient, and Federal Reserve officials remain split on whether to cut interest rates for the third time this year at their meeting on December 9–10.
Economists had expected a continuation of the recent trend: weak hiring but few layoffs, meaning people with jobs are mostly secure, while those without work are finding it harder to get hired.
Revisions from the Labour Department also revealed that the US economy created 911,000 fewer jobs than previously reported in the year ending in March.
Job growth since March has been even slower, averaging 53,000 jobs a month, compared with 400,000 a month during the 2021–2023 post-pandemic hiring boom.
President Donald Trump’s crackdown on illegal immigration is also expected to reduce the number of people looking for work, meaning the economy can create fewer jobs without pushing unemployment down.
New Labour department report
A separate Labour Department report showed that new unemployment claims fell by 8,000 to 220,000 in mid-November. This decrease explains that fewer people are losing jobs.
But the number of people already receiving unemployment benefits rose to 1.974 million, a sign that those who lose jobs are finding it harder to get new ones in a weak hiring environment.
The claims report covers the same period when businesses were surveyed for the November jobs report. The Bureau of Labor Statistics said it extended data collection and processing times because the shutdown prevented normal survey work.
