The non-farm payrolls report for September is telling the same story that much of the recent data has been telling us. Growth isn’t collapsing, but it also seems to be stuck in a holding pattern. The best news around lately might just be this idea that we’re set to repeat 2008 all over again. In other words, expectations have been set so low that there is ample room for upside surprise. Unfortunately, we’ve gotten to the point where we celebrate a 100K NFP number. Pathetic in all honesty. Welcome to the balance sheet recession. Enjoy your stay.
Econoday has the details on this morning’s data:
Job growth improved more than expected in September although the gain was held back by contraction in the government sector. Payroll jobs advanced 103,000 in September, following a revised 57,000 rise in August (originally flat) and revised 127,000 increase in July (previously 85,000). Analysts forecast for a 65,000 increase for September. Revisions for July and August were up net 99,000. Private nonfarm payrolls were somewhat stronger than the total, gaining 137,000 in September, following a 42,000 increase in August and 173,000 boost in July. The September number topped the market expectation for a 95,000 increase. A return of striking telecommunications workers added about 45,000 to the payroll total.
In the private sector, goods-producing jobs rebounded modestly while service-providing jobs posted a notable gain. Goods-producing jobs rebounded 18,000 after a 9,000 decrease in August. Manufacturing jobs fell 13,000 after a 4,000 dip the month before. Motor vehicle industry jobs were flat in September. Construction rebounded a sizeable 26,000, following a 7,000 decline in August. Mining grew 5,000, following an 3,000 gain the prior month.
Private service-providing jobs jumped 119,000 in September, following a 51,000 gain the prior month. The August gain was led by professional & business services (up 48,000) and health care (up 44,000). Employment in information was up by 34,000 over the month due to the return of about 45,000 telecommunications workers to payrolls after an August strike.
The public sector shrank as government employment fell 34,000, following a 15,000 rise in August. August would have declined other that due to a return of 22,000 Minnesota government workers from a partial government shutdown.
Wages rebounded 0.2 percent in September after dipping 0.2 percent the prior month. Analysts had projected a 0.2 percent increase. The average workweek for all workers in September ticked up to 34.3 hours from 34.2 hours in August. The median forecast was for 34.3 hours.
From the household survey, the unemployment rate held steady at 9.1 percent. The consensus expected a rise to 9.2 percent.
Today’s report indicates that the labor market is not quite as sluggish as earlier believed. Importantly, the services sector may be gaining mild momentum. Looking ahead, today’s numbers point to a healthy wages & salaries component in the upcoming personal income report. However, industrial production for September is likely to be soft outside of autos.