Investing.com - August's employment report gave a mixed reading with better-than-expected job creation but a jobless rate that held steady compared to expectations for a drop. Wage inflation advanced more than expected, causing an initial pullback in U.S. stock futures, although investors quickly pared losses after the initial dip.
Nonfarm payrolls (NFP) rose by 201,000 in August, according to official data released on Friday.
The data was higher than the consensus estimate for the creation of 191,000 jobs and the 163,000 positions that the ADP report indicated on Thursday.
The previous month’s reading of NFP was revised to 147,000 from the 157,000 registered initially.
The jobless rate unexpectedly held steady at 3.9%. Analysts had expected it to tick down to 3.8%.
Average hourly earnings advanced 0.4% month-on-month in August, above expectations for a 0.3% gain.
On an annualized basis, wage inflation grew 2.9% in August.
Economists had estimated no change from July’s 2.7% rise.
The increase in wages is being closely monitored by the Federal Reserve for evidence of diminishing slack in the labor market and upward pressure on inflation. Economists generally consider an increase of 3.0% or more to be consistent with rising inflation.
Average weekly hours clocked in at 34.5 last month. That was in line with the forecast and previous month’s reading.
Additionally, the private sector created more new job contracts than expected in August with a total of 204,000.
Analysts had forecast the creation of just 190,000 new private sector jobs.
June’s number was revised to an increase of 153,000 private nonfarm payrolls, from the prior reading of 170,000 jobs in the private sector.
Government payrolls decreased by 3,000 last month, compared to the prior destruction of 6,000 public positions.
July’s data on government payrolls was an upward revision from the initial reading of the destruction of 13,000 public positions.
The participation rate slipped to 62.7% last month, from July’s reading of 62.9%.
The U-6 unemployment rate, that includes those workers who are working part-time for purely economic reasons, fell to 7.4% in August from the prior 7.5%.