Job Creation Falls Short Of Expectations In August, Unemployment Rate Ticks Lower, Wage Growth Soars
Signs of a cooling U.S. labor market eased in the government’s Friday August jobs report, tempering recession fears that had intensified in July and earlier this week.
In August, the U.S. economy added 142,000 nonfarm payrolls, signaling a sharp improvement from July’s downwardly revised 89,000.
The 142,000 increase in nonfarm payrolls fell short of the 160,000 consensus estimate tracked by TradingEconomics, highlighted weaker-than-expected job acceleration during the month.
Before the release of the August jobs report, traders priced in a 43% probability of a 50-basis-point interest rate cut by the Federal Reserve later this month.
August Employment Situation: Key Highlights
- The unemployment rate softened from 4.3% to 4.2%, matching expectations of a slight decline.
- Wage growth showed some upward pressure. Average hourly earnings rose 0.7% month-over-month, up from a downwardly revised contraction of 0.1% in July and surpassing estimates of 0.3%.
- On a year-over-year basis, average hourly earnings rose 3.8%, compared to 3.6% in July and above expectations of 3.7%.
| August 2024 | Consensus | July 2024 | |
|---|---|---|---|
| Nonfarm payrolls | 142,000 | 160,000 | 89,000 (downwardly revised from 114,000) |
| Unemployment rate | 4.2% | 4.2% | 4.3% |
| Average hourly earnings (m/m) | 0.7% | 0.3% | -0.1% (downwardly revised from 0.2%) |
| Average hourly earnings (y/y) | 3.8% | 3.7% | 3.6% |
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