The United States has added a further 315,000 jobs in August, according to data released by the Bureau of Labor Statistics (BLS).
The latest figure brings employment levels 240,000 higher compared to pre-pandemic level found in February 2020, and over the past 12 months the jobs total has risen by 5.8 million.
Job creation has however slightly eased in August compared to the previous month when there was a 528,000 rise in employment.
Yet the latest statistics would not come as a surprise to analysts, as many anticipated an increase of around 300,000 positions.
Jobs growth was led by professional and business services, which created 68,000 jobs, mainly in computer systems design, management and technical consulting, architecture, and engineering.
Health care employment rose by 48,000, with the highest number of posts in hospitals and physician offices.
The retail sector was not far behind, creating 44,000 jobs, where general merchandise stores, food and beverage and health and personal care outlets were the driving forces.
Manufacturing and financial services employment also rose by 22,000 and 17,000, respectively.
Overall employees have received a slight hourly earning raise by 10 cents climbing to $32.36.
Over the past 12 months hourly earnings have increased by 5.2% but punishing inflation rates which seem to have peaked at 9.1% in June have eclipsed wage increases.
More workers are also going back into the office, as the number of those working remotely decreased to 6.5% in August, down 0.6% month on month. This may provide some economic boost in towns and cities as footfall increases.
Unemployment Rises
The unemployment rate also rose in August by 0.2% up to 3.7%, leaving the total number of unemployed at 6 million.
In July unemployment numbers had returned to pre-pandemic levels.
When breaking down unemployment the BLS found that the number of permanent job losers increased by 188,000 to 1.4 million in August, while the number of persons on temporary layoffs was virtually unchanged at 782,000.
The level of long-term unemployed, defined as those who have been without a position for 27 weeks or more, remained stable at 18.8% of the total unemployed.
Yet the labour force participation rate increased by a slender 0.3% compared to July at an overall 62.4%, still down by 1.1% before the coronavirus pandemic began to bite in February 2020.
Interest Rates Highly Likely to Increase Further
The United States labour market this year has been a standout performer in the global economy, despite all the headwinds that it is facing from high inflation to global uncertainties due to the war in Ukraine.
Yet its resilience and continued high inflation are likely to send strong signals to the Federal Reserve to continue its interest rate rising policy at its next meeting later this month that will hurt businesses and households alike.
The Fed’s chair Jerome Powell recently made a hawkish speech making it clear how determined they are to bring inflation down.
Audit and consultancy firm RSM recently compiled a study and concluded that even if the Fed were to revise upward its inflation target from 2% to 3%, this would require a loss of 1.7 million jobs bringing the unemployment rate up to 4.6%.
US Dollar Maintains Edge over Pound
After the release of the jobs data, the US Dollar continued in its recent dominance over the plummeting British Pound as the GBP/USD currency pair fell. albeit by a small 0.11% margin, leaving a dollar worth £0.87.
In other currency pairings, the EUR/USD currency pair fell by 0.57%, while the USD/JPY exchange rate remained stable.
Source link
