US jobs report for August: Analysts react
A rate increase in the Fed funds rate come December was still likely but August´s non-farm payrolls report would not convince officials at the US central bank to make a move in September. The rate of growth in average hourly earnings slipped to a six-month low, average weekly hours plumbed a two-and-a-half year low and a 3,100 decline in temporary hiring "wasn´t exactly positive either". Nonetheless, the August report had long history of missing expectations only to afterwards be revised higher. Yet even if Fed officials were suspicious, they would want to wait another couple of months, in order to ensure the data turns higher in September and that August is revised up. - Paul Ashworth, chief US economist, Capital Economics
The August jobs report was soft all around but one could discount the sluggish wage figures. Indeed, hourly earnings could easily have been worse as the August number was under pressure from two calendar quirks. This time the 15th - payday for those on semi-monthly wages - fell after the survey week and August had 23 working days, one more than usual. The year-on-year pace of gains in wages also took a hit because the large 0.4% rise seen in 2015 fell out of the comparison. Even so, the fact that the pace of decline in the unemployment rate has slowed substantially - unchanged since January 2016 at 4.9% - means policymakers will feel they have a bit more room for manouvre. Ian Shepherdson, chief economist, Pantheon Macroeconomics
Non-farm payroll growth in August, at 151,000, was solid, with the three-month rate of change standing at 232,000. Similarly, while the establishment survey softened a bit across the board, it continues to show underlying strength. Despite the slower pace of job growth the report shows labour market health remains intact and hence economic activity solid. It should also reaffirm most FOMC members in their confidence about the outlook. Those levels of activity will pull inflation up to the Fed´s target, so a rate hike in September is still the most likely scenario. - Rob Martin, Michael Gapen, Barclays Research
At 232,000 the three-month average rate of growth for non-farm payrolls far exceeds the range of estimates (50,000-150,000) from Fed officials of the pace needed to keep the rate of unemployment stable. Nothing in this report constitutes a warning signal about the economy´s direction of travel. It´s good enough for the FOMC to move in September. Having met its employment target the Fed needs to gradualy adjust policy before its 2% inflation objective is met, not afterwards. - US economics team, BNP Paribas
On the basis of past form, the weak details in the report such as declines in the length of the average workweek and average hourly earnings likely mostly reflect seasonal adjustment problems instead of underlying weakness. So the Fed continues to be on track for a hike in December, but September appears to be off the table for now given the Fed´s preference for erring on the side of caution. A very strong number would have been needed to shift the maths in favour of September. - Dr. Harm Bandholz, chief US economist, UniCredit Research