US hiring posts 1st fall in 7 years in September
Print Edition
US employment fell in September for the first time in seven years as Hurricanes Harvey and Irma left displaced workers temporarily unemployed and delayed hiring, the latest indication that the storms undercut economic activity in the third quarter.
The Labor Department said on Friday nonfarm payrolls fell by 33,000 jobs last month amid a record drop in employment in the leisure and hospitality sector. The decline in payrolls was the first since September 2010.
The department said Harvey and Irma, which wreaked havoc in Texas and Florida in late August and early September, reduced employment last month. But underlying details of the closely watched employment report were upbeat.
The unemployment rate hit a more than 16-1/2-year low of 4.2 percent and annual wage growth accelerated to 2.9 percent.
“Investors will find solace in a whole host of other labor market indicators that reveal an underlying labor market that continues to show evidence of resilience and continued tightening,” said Scott Anderson, chief US economist at Bank of the West in San Francisco.
Economists had forecast payrolls increasing 90,000 in September. Payrolls are calculated from a survey of employers, which treats any worker who was not paid for any part of the pay period that includes the 12th of the month as unemployed.
Many of the dislocated people will probably return to work. That, together with rebuilding and clean-up is expected to boost job growth in the coming months.
Leisure and hospitality payrolls plunged 111,000, the most since records started in 1939, as employment at restaurants and bars fell 104,700. There were also decreases in retail and manufacturing employment last month.
The economy created 13,000 more jobs than previously reported in August. Harvey and Irma did not have an impact on the jobless rate, which fell two-tenths of a percentage point from August to the lowest since February 2001. The smaller survey of households from which the jobless rate is derived treats persons as employed regardless of whether they missed work during the reference week and were unpaid as a result.
The decrease in the unemployment rate reflected a 906,000 surge in household employment, which eclipsed a 575,000 increase in the labor force.
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