More than two weeks late because of the government shutdown, the September jobs report finally came out Tuesday — and turned out to be more of a political football than a major markets mover.
The best that could be said was that both the employment and unemployment numbers showed modest improvement.
A 0.1 percent drop in the unemployment rate to 7.2 percent and a so-so net increase of 148,000 payroll jobs helped spur stock gains as investors assumed the Federal Reserve will continue its economic stimulus efforts when policymakers meet next week. Some solid corporate earnings reports also injected confidence in the markets.
But Republican House Speaker John Boehner called the jobs report “disappointing” and an example of the administration’s “failed stimulus policies.”
The council’s current chairman, Jason Furman, was more neutral, acknowledging that job growth suffered from “self-inflicted wounds,” meaning the political wrangling.
Both sides agreed that more work remains to be done, and that October’s job report, due out Nov. 8, may not be any brighter, given the ripple effects of the government shutdown and worker furloughs.
Economists estimate that the shutdown cut $25 billion out of the U.S. economy, and it brought GDP growth rate predictions down to 2 percent for the quarter from 2.5 percent.
September’s paltry employment growth indicated that employers remained exceedingly cautious about the state of the national economy and the political brinksmanship in Washington.
Economists said they worried that the October and November job reports also may be less than clear about the true nature of the economy, given that it will take a couple of months to absorb the effects of the shutdown and furloughs.
The Fed has been buying $85 billion of bonds each month to keep long-term interest rates low and encourage economic growth. But with gains in income and wealth from the recovery going mainly to the wealthiest Americans, there’s insufficient demand to stimulate hiring. And U.S. companies — afraid of the effects of the Affordable Care Act, a protracted debate about the federal debt limit and trickle-down financial losses from the shutdown — aren’t rushing to hire.
The jobs report from the U.S. Bureau of Labor Statistics showed that the national jobless rate is at its lowest since the end of 2008, but it’s still considered unacceptably high. The jobless rate has fallen from 7.9 percent so far in 2013, but the political wrangling of the last three months has helped depress growth.
Employers added an average of 143,000 jobs a month from July through September, compared with an average of 182,000 a month from April through June and an average of 207,000 a month from January through March.
Some other statistical highlights from the September report:
• The labor force grew by 73,000 from August.
• The number of unemployed fell by 61,000 to 11.3 million and was down by more than half a million since June.
• The labor force participation rate was unchanged at 63.2 percent, sticking at its lowest since August 1978.
• The number of people working part time for economic reasons (because they couldn’t find or keep a full-time job) rose by 75,000 to 7.9 million.
• The number of long-term unemployed — those job hunting for six months or more — has fallen by 725,000 over the past year to 4.1 million but still accounts for 36.9 percent of the unemployed.
The jobs report also said that average hourly earnings in September rose just 0.1 percent to $24.09. Also, the average work week for all workers held steady at 34.5 hours, and average weekly earnings rose 0.1 percent.
Economists said earnings are unlikely to rise by much more until job creation accelerates.
At an investment outlook conference Tuesday in Kansas City, U.S. Bank executive Dan Heckman said he considered the jobs report to be “on the weak side” but mostly “middle of the pack” as far as recent months go.
He noted positive job gains in some well-paying industries, including construction and professional services. That compares with much post-recession growth that has been in relatively lower-paying jobs in the service and retail industries.
The Labor Department used the September report to revise by 9,000 the previously reported employment numbers for July and August. It said employers added 193,000 jobs in August, up from the 169,000 reported earlier. But it lowered July’s job growth to 89,000, down from the earlier report of 104,000.Where jobs grew or fell in September Industry sectors with statistically notable net job gains:
Transportation and warehousing
Employment and professional services
+ 32,000Industry sectors with statistically little change:
Health care, leisure and hospitality, mining and logging, manufacturing, and information.Industry sector with statistically notable losses:
Financial activitiesSource: U.S. Bureau of Labor Statistics