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U.S. Economy Added 661,000 Jobs in Sept, vs 850,000 Expected

Economic IndicatorsOct 02, 2020 08:34AM ET
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By Geoffrey Smith 

Investing.com -- The U.S. labor market's recovery weakened in September, with the economy adding only 661,000 new nonfarm jobs through the middle of the month, less than half of what it created in the month through mid-August.

The number was well below expectations for net gains of 850,000. However, August's numbers were revised up by 118,000 to 1.47 million.

Kit Juckes, a macro strategist for Societe Generale (OTC:SCGLY), said via Twtter that the data "suggest (the) jobs recovery is ongoing but slowing a bit."

The unemployment rate fell more than expected to 7.9% of the workforce, from 8.4% in August. Analysts had expected a rate of 8.2% ahead of time. The broader 'U6' measure of underemployment also fell, but stayed at the historically high level of 12.8% of the labor force. Participation in the workforce fell again, to 61.4% from 61.7% in August.

The shortfall in job gains was accounted for entirely by government employment, which fell by 216,000 in the month. Private payrolls expanded by 877,000, even more than expected after ADP flagged a gain of just under 750,000 earlier in the week. 

Financial markets were nonetheless disappointed by the news, which followed only hours after President Donald Trump's positive test for the Covid-19 virus for once upstaged what is normally the world's most important economic data release of the month. By 8:55 AM ET (1455 GMT), Dow Jones Futures were down 1.6% after being down only 1.2% immediately before the release, while S&P 500 Futures were down 1.7%.

The last two months' data have been distorted to a degree by hiring for the 2020 census. On a slightly longer view, it now appears that the economy has clawed back just over half of the jobs that it lost in first wave of the pandemic in spring. 

However, the pace of improvement has slowed markedly from nearly 4.8 million new jobs in June to less than one-fifth of that in September. In addition, there are increasing signs of companies finally resorting to layoffs as the level of government support for the economy ebbs in the absence of a new fiscal support package. Walt Disney  (NYSE:DIS), United Airlines (NASDAQ:UAL) and American Airlines Group (NASDAQ:AAL) between them confirmed some 60,000 job cuts this week alone, while insurer Allstate  (NYSE:ALL) and Goldman Sachs (NYSE:GS) also announced they would shed positions.

"Today's jobs report will not change perceptions that (the) U.S. labor market is stressed," wrote Marc Chandler, managing director of Bannockburn Global Forex. "Yesterday, we learned 837,000 people filed initial unemployment benefit and another 650,000 sought emergency assistance."

 

U.S. Economy Added 661,000 Jobs in Sept, vs 850,000 Expected
 

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Comments (16)
Tyler Sydenstricker
Tyler Sydenstricker Oct 05, 2020 4:30AM ET
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bullish news
Justin Rashad
Justin Rashad Oct 02, 2020 1:37PM ET
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How is the market still up on all this bad bad news?? Hmmm investigation soon
Larry Deangelis
Larry Deangelis Oct 02, 2020 1:37PM ET
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The market has been rigged since 2009 with the algos driving up prices on any bit of good news. Today was probably that the Lithuanian stock market was up.Biggest ponzu scheme ever!
Jo Va
Jo Va Oct 02, 2020 1:35PM ET
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trumps watch, trumps economy, and trumps failure to protect our economy, nation, and it's citizens. Vote the loser out in November to save our economy, our nation, and the lives of American Citizens.
James Johannsen
James Johannsen Oct 02, 2020 1:35PM ET
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a vote for anyone is a vote for the federal reserve
Jo Va
Jo Va Oct 02, 2020 1:35PM ET
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James Johannsen A vote for their choice is what responsible American Citizens do. There's no other way to affect the fed if you don't, or do you just need something to complain about?
Ed Glass
EddieG Oct 02, 2020 11:12AM ET
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Fake news, republican faux. Looking to get sympathy vote and excuse for botched debate.
Thom Miller
Thom Miller Oct 02, 2020 10:47AM ET
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You’ll clearly recall four years ago when Trump was campaigning, the only unemployment number he ever quoted was “real unemployment,” known by economists as the U-6 rate. Currently that number is a whopping 14.2%, down from the 22.8% of few months ago, but still an historically high number. If Trump ran on the U-6 rate four years ago, then it’s only fitting that he do so now as well. And oh, by the way, when Trump was quoting the U-6 number in September 2016, it was only 9.7%. It is now 50% higher. I tell you this, because lyin’ Donny never will. Trump’s cooked! Stick a fork in him!
king michael
king michael Oct 02, 2020 10:21AM ET
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Most people lost jobs in March, April and even May will no longer being counted as unemployed with employment compensation run out. But large number of people are actually lost job at those three months.
Vincent Li
Vincent Li Oct 02, 2020 9:31AM ET
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Another market collapse
hit man
hit man Oct 02, 2020 9:23AM ET
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reality is very dangerous
Ryan Plesz
Ryan Plesz Oct 02, 2020 9:07AM ET
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if people are no longer on unemployment because it ran out are they now considered employed in the numbers....I think they are....all fake numbers. I don't trust the government.
Justice Ndubuisi
Justice Ndubuisi Oct 02, 2020 9:02AM ET
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please is dollar going to be week
Jesse Mulliniks
Jesse Mulliniks Oct 02, 2020 8:53AM ET
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Reality is setting in
Danny Danny
Danny Danny Oct 02, 2020 8:43AM ET
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Added jobs, not subtracted. Be patient, this might take a while but we will prosper.
Jeffro Bodene
Jeffro Bodene Oct 02, 2020 8:41AM ET
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Winning! LOL
Nathan Skogen
Nathan Skogen Oct 02, 2020 8:40AM ET
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Im terribly sorry. I, also work stock market options and preparing for a very big day.
Matt Barton
Matt Barton Oct 02, 2020 8:40AM ET
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dork
Khalid Rashid
Khalid Rashid Oct 02, 2020 8:39AM ET
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Is amerikkka great gain yet?
Andrew Allen
Andrew Allen Oct 02, 2020 8:39AM ET
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america is most multicultural and one of the least racist places in the world. especially less racist than wherever khalid rashid is from
Jo Va
Jo Va Oct 02, 2020 8:39AM ET
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Andrew Allen Only if you omit trumps admin, the GOP, and the majority of those that support them.
Wayne Ng
Wayne Ng Oct 02, 2020 8:37AM ET
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Simply by putting less people in the employ
Nathan Skogen
Nathan Skogen Oct 02, 2020 8:37AM ET
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Again i apologize and sure if you you and your team is too busy thats fin
 
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