US jobs grew least in eight months in August: report
06 Sep 2014
Hiring at US firms stood at the lowest in eight months in August and more US citizens stopped looking for jobs, giving a cautious Federal Reserve more reasons to wait longer before increasing interest rates, Reuters reported.
Nonfarm payrolls were up 142,000 last month, after seeing an expansion by 212,000 in July, the Labor Department said yesterday. The jobless rate was down one-tenth of a percentage point to 6.1 per cent. However, that was partly due to people dropping out of the labour force.
According to Diane Swonk, chief economist at Mesirow Financial in Chicago, Fed chief Janet Yellen would be able to use the weakness to hold off hawks who would like to raise rates soon.
Data for June and July were revised to show creation of 28,000 fewer jobs than reported earlier. Additionally, no job growth was seen in manufacturing and retail payrolls fell for the first time since February, even as a workforce disruption at a grocery store chain in New England impacted the count.
Even though job growth slowed, the report, however, suggested that some of the slack in the labour market was being taken up.
US stocks ended higher, in the fifth straight week of gains and prices for US Treasury debt marginally increased, as the dollar recovered earlier losses and changed little against a basket of currencies.
The lacklustre August hiring ended a run of strong gains and caught analysts by surprise after recent reports pointed to an improving economy.
The economy generated just 142,000 jobs in August, the Labor Department said yesterday, undershooting by a wide margin, the average of 212,000 over the previous 12 months, AP reported.
Employers had also generated 28,000 fewer jobs in June and July than what the government had estimated earlier.
The slowdown was not expected after most recent economic data showed that the economy was growing at a healthier pace. According to some analysts, other measures of the job market remained solid and the figures for August could mark just a temporary slowdown.
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