US Jobs Report: 235,000 jobs added in August, showing a significant slowdown

Economic growth is stagnating while inflation is creeping upwards. Not a good medium or long term outlook for the US at the moment. The jobs market has under performed expectations by about 500,000, which is a very ominous sign for economic growth and stability.

On the bright side - unemployment rates have also dipped, likely because of a reduction in federal unemployment payments. For Louisiana, there's a good chance that there will be a short term boost in economic activity for hurricane recovery and hospitality industry because of Ida.

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U.S. employers added 235,000 jobs in August, a marked slowdown.

NYT

The American economy slowed abruptly last month, adding 235,000 jobs, a sharp drop from the huge gains recorded earlier in the summer and an indication that the Delta variant of the coronavirus is putting a damper on hiring.

The Labor Department report on Friday follows a sharp increase in coronavirus cases and deaths that has undermined hopes that restrictions on daily activities were nearing an end.

The unemployment rate was 5.2 percent, compared with 5.4 percent in July. Economists polled by Bloomberg has been looking for gain of 725,000 jobs.

The August showing would have been respectable in prepandemic times. But after gains of 962,000 in June and 1.05 million in July — and with more than eight million people unemployed — it was a sharp deceleration.

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The jobs report showed a sharp pullback in hiring in leisure and hospitality, which tends to be especially sensitive to virus outbreaks. At the same time, wages continued to rise in general and for leisure and hospitality workers in particular — suggesting that employers are paying up to lure employees, and hinting that labor supply issues may be part of the reason they hired more slowly in August.

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The slower reaction this time comes in part because economic conditions have been evolving so quickly. But more than that, many policymakers have come to see the Fed’s decision to start raising interest rates in 2015 — before the labor market was operating at full speed or inflation had stabilized — as a mistake.

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Some promising news that might be an early hint at the impact of reducing unemployment payments:

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Other data from the Labor Department was more upbeat: The unemployment rate fell, as economists had predicted, to 5.2 percent from 5.4 percent, and wage growth was faster than expected.

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