February 19, 2018

How hurricanes could distort September jobs numbers

07 October 2017, 12:17 | Kenneth Drake

Hurricanes hit US hiring in September, services sector resilient

US Jobless Claims fall 12000 to 260000

As the Labor Department reported that the US economy lost 33,000 jobs in the month of the September - possibly due to the impact of Hurricane Harvey and Hurricane Irma - the numbers behind that new jobs report did not seem to indicate a broader negative outlook for the USA economy, but it's clear that economic growth still hasn't moved into a higher gear as yet in the Trump Administration.

Economists expected the economy to add about 90,000 jobs last month. The median forecast called for 100,000 jobs to be added in September and the unemployment rate to hold steady at 4.4%.

The unemployment rate, which was 4.4% in August, fell to 4.2%.

The job losses were so substantial that it caused the number of jobs across the entire US economy to shrink by 33,000 last month.

And average hourly earnings jumped by 12 cents in September to $26.55.

It seems a little risky to rely on data that shows an increase of nearly a million jobs in a month.

The longest streak of monthly job gains, going back to September 2010, is over: the national economy lost 33,000 jobs in September, an outcome the Labor Department is attributing to the effects of Hurricane Irma.

As total nonfarm employment declined for the month, temporary help experienced mild growth, on top of favorable revisions for the two prior months. In the establishment survey, employees who are not paid for the pay period that includes the 12th of the month are not counted as employed.

Among the major worker groups, the unemployment rates for adult men (3.9 percent) and Blacks (7.0 percent) declined in September.

Unemployment is at the lowest level since February 2001.

The labor force participation rate (63.1 percent) and the employment-population ratio (60.4 percent) remain essentially unchanged from August. Summaries from July and August showed impressive growth in the residential construction sector, giving economists a glimmer of hope that an inventory increase was on the way, but Hurricanes Harvey and Irma stifled that growth.

Overall, 152 million people are employed in non-agricultural industries, 122.1 million of them in private industry, 20.9 million in government, and 8.9 million are self-employed in unincorporated enterprises.

The figures are closely monitored by policy makers at the Federal Reserve as a way to determine underlying trends and future economic strategy.

Hurricane Maria, which devastated Puerto Rico and the U.S. Virgin Islands, did not affect this report.

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