U.S: Strength in jobs and ISMs

1 min

The robust economy created +201,000 jobs in August although the prior two months were revised down a total of -50,000. Gains were widespread across industries, including +23,000 in construction, the most in three months, and +17,000 in leisure and hospitality, again indicative of consumers’ willingness to spend on discretionary items. The unemployment rate remained unchanged at 3.9%, and the broader measure of unemployment, the U-6, ticked down to 7.4%, the lowest since records have been kept starting in 1994, over 24 years ago. But wages were the big story, rising from +2.7% to +2.9% y/y, the fastest in over nine years since the recession. The report strengthens the case for two more rate hikes from the Fed this year. Two other reports also demonstrated a vigorous economy – the ISM manufacturing index rose to a 14-year high of 61.3 points, led by a sharp +4.9 point increase to 65.1 in the new orders index, and the non-manufacturing index gained +2.8 points to 58.5. Survey respondents reported strong demand but concerns over tariffs.