Total nonfarm payroll employment increased by 142,000 in September, and the unemployment rate was unchanged at 5.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care and information, while mining employment fell.
“The September employment situation report was a blow to confidence in the strength of the U.S. economy as it reflected recent weakness in job creation. Employment growth over the last two years has been a key driver of this year’s robust housing demand,” says realtor.com® Chief Economist, Jonathan Smoke. “The headline initial September job creation number of 142,000 was well below market expectations of 200,000. Perhaps even more shocking were downward revisions to the July and August data. Analysts had been expecting significant upward revisions to August, as the typical pattern, but instead July and August were revised down by 81,000 jobs.”
In September, the number of unemployed persons (7.9 million) changed little. Over the year, the unemployment rate and the number of unemployed persons were down by 0.8 percentage point and 1.3 million, respectively.
Among the major worker groups, the unemployment rates for adult men (4.7 percent), adult women (4.6 percent), teenagers (16.3 percent), whites (4.4 percent), blacks (9.2 percent), Asians (3.6 percent), and Hispanics (6.4 percent) showed little or no change in September.
The number of persons unemployed for less than 5 weeks increased by 268,000 to 2.4 million in September, partially offsetting a decline in August. The number of long-term unemployed (those – 2 – jobless for 27 weeks or more) was little changed at 2.1 million in September and accounted for 26.6 percent of the unemployed.
“Job creation is a very important leading indicator of strong demand for housing,” says Smoke. “The strong employment results for the last two years created an uptick in household formation, which drives demand for home purchases and rentals. If this softening sticks, we could see less robust growth in the year ahead.”
The civilian labor force participation rate declined to 62.4 percent in September; the rate had been 62.6 percent for the prior 3 months. The employment-population ratio edged down to 59.2 percent in September, after showing little movement for the first 8 months of the year.
The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) declined by 447,000 to 6.0 million in September. These individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job. Over the past 12 months, the number of persons employed part time for economic reasons declined by 1.0 million.
In September, 1.9 million persons were marginally attached to the labor force, down by 305,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.
Among the marginally attached, there were 635,000 discouraged workers in September, little changed from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.3 million persons marginally attached to the labor force in September had not searched for work for reasons such as school attendance or family responsibilities.
“A few data points in the report were more positive,” says Smoke. “The unemployment rate remained 5.1 percent, the lowest level since March 2008. The U-6 unemployment rate, which is the broadest measure of unemployment, fell to 10 percent, the lowest level since May 2008.”
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