WASHINGTON: America’s jobs engine downshifted in August as employers unexpectedly held back hiring across major industries, another sign that the world’s largest economy could be weakening, government data showed Friday.
As the numbers were released, President Donald Trump, whose record as a job creator could wane ahead of next year’s elections, renewed his attacks on the US central bank, which he blames for failing to stimulate the economy fast enough.
The surprisingly weak result confirmed that labor markets in 2019 have softened from their brisk pace last year amid a protracted trade dispute with China that has dragged down global trade, caused a spike in business uncertainty and driven US manufacturing into recession.
Employers added 130,000 net new positions for the month, far lower than analyst forecasts, while the jobless rate held steady at 3.7 percent for the third month in a row, and wages rose, according to Labor Department estimates.
Estimates for the May and June were also cut by a total of 20,000 positions, bringing the rolling, three-month average to 156,000 positions, well below the 241,000 seen in August last year.
Amid weak investment by companies and mounting fears of a recession, employers also say they are struggling to find qualified workers to fill open positions.
The soft jobs numbers should also add to pressure on the Fed to cut interest rates later this month, as economists widely expect it to do.
– ‘Oh, well…’ –
Late Thursday and early Friday, Trump took to Twitter for the latest of many attacks on the US central bank, which he said had raised interest rates too quickly last year.
“They were WAY too early to raise, and Way too late to cut — and big dose quantitative tightening didn’t exactly help either,” said Trump, who has advance access to the jobs report.
“Where did I find this guy Jerome?” he said, referring to Fed Chairman Jerome Powell, whom he appointed.
“Oh well, you can’t win them all!”
Workers, however, got a bump in pay, as hourly wages rose 11 cents on average, putting them up more than three percent, year-on-year, for the 13th month in a row.
Within the August details, there were other causes for concern.
About quarter of August hires came from the government itself as federal authorities prepare to conduct next year’s census.
Private-sector employers added only 96,000 jobs in August, well below the 145,000 economists had forecast.
In the dominant service sector, the retail, transportation and utilities industries all shed jobs for at least the second month in a row.
Workforces also shrank in the mining sector, likely suffering weak oil prices.
Hiring was cut in half in the education and health industries and was flat for auto manufacturers and information services as well as leisure and hospitality.
Wall Street appeared unimpressed with the numbers, as stock futures pared gains following their release.