U.S.: Mixed data

3 min
Dan North
Dan North Senior Economist for North America

The economy added only +130k jobs in August vs. expectations of +160k, and the prior two months were revised down -20k. But government employment rose by the hiring of +25k temporary Census workers, and, as a result, private payrolls gained only +96k, well below the +177k average over the past 12 months. Retail lost -11k jobs and manufacturing gained only +3k jobs. But there was also strength in the report: the unemployment rate remained unchanged at 3.7%; the participation rate rose +0.2pp to 63.2%, tying February for the highest of the expansion period; the labor force rose by a strong +571k; and wages beat expectations, gaining +0.4% m/m. The weakness in manufacturing was also reflected in the ISM manufacturing survey, which slipped below the 50 level into contraction area at 49.1, the lowest level in almost four years. Seven of the ten components fell, and nine are now below 50 for the first time since the recession. But on the positive side, the ISM non-manufacturing survey rebounded by +2.7 points to 56.4, with nine of the ten components above 50.