Job Growth Underwhelms, Unemployment Rate Lowers in September

Oct 08, 2019
| Michael Altiero
September 2019 Jobs Report

It’s hard to believe but we are now in October, and the beginning of a new months means that the Bureau of Labor Statistics has released their Jobs Report data for September.

The August report had mixed results about the United States economy and job market. Job creation fell short of estimates, while the unemployment rate remained the same. Wage growth, however, came in ahead of estimates.

Now that the September report has been made available, how do the results look? Are the numbers better or worse than August? Let’s dive into the data and find out.
 

Unemployment Rate Lowers to Historic Lows

In August, the unemployment rate held steady at 3.7% for the third straight month. Despite the stagnant percentage, unemployment in the United States has been a constant positive in 2019’s Jobs Report.

And in September, the news got even better. The unemployment rate dropped .2 percentage points to come in at 3.5%, making this a 50-year low for this important economic indicator.

Further positive news involved another measure for unemployment (often referred to as the “real” unemployment rate) that includes the underemployed and discouraged workers also fell in September to 6.9%, a 19-year low.

The results for both unemployment measures are extremely positive, especially since the unemployment rate was expected to once again remain at 3.7%.
 

Job Growth Misses Forecasts

Payroll increases are always one of the most anticipated results in the monthly Jobs Reports. In August, this number missed expectations with 130,000 new jobs created against estimates that came in around 160,000.

The results for September were more of the same with 136,000 jobs created while forecasts had this number around 145,000.

However, not all the news around job growth was negative. Upward revisions for August and July were revealed. August’s number moved from 130,000 to 168,000 while July saw an increase from 159,000 to 166,000.

This resulted in a net gain of 45,000 jobs.
 

Wage Growth Grows YoY, But the Lowest Increase Since 2018

Wage growth has been an important metric for both economists and employees alike, as many experts have predicted that this percentage would steadily rise as unemployment lowered and recruiting became more challenging for employers.

And while wage growth year-over-year has been consistently in the 3% range since summer 2018, it hasn’t been increasing as much and as frequently as many had hoped.

In September, year-over-year wage growth was just 2.9%, missing estimates of 3.2%. This is the lowest result since July 2018.

It will be interesting to see if this number rebounds in October or if a downward trend begins.
 

The September Jobs Report Shows Mixed Results

Overall, the September 2019 Jobs Report had a mixed bag of results. Unemployment was a very positive outcome, and even though job gains missed expectations, upward revisions for the two prior months helped to make up for this negative result.

However, wage growth dipped below 3.0% for the first time since summer 2018, which could signal other economic impacts in the coming months.

As always, expectations will be high for the October report that will be coming out in just a few short weeks.

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