Published: Sun, October 07, 2018
Economy | By

Unemployment falls to lowest level since 1969 as economy adds 134000 jobs

Unemployment falls to lowest level since 1969 as economy adds 134000 jobs

"The unemployment rate fell two-tenths of a percentage point to 3.7 percent, the lowest level since December 1969 and one-tenth of a percentage point below expectations", writes CNBC.

Job growth has accelerated this year after decelerating in three prior years. The health of the U.S. economy and reinforced rate rise expectations helped to trigger the sell-off in Treasuries, sending the yield on the 10-year paper to 3.23 per cent this week, its highest level in seven years.

In September, the labor force participation rate remained at 62.7 percent, and the employment-population ratio, at 60.4 percent, was little changed. However, broader measure of labour market slack, which includes people working part-time because they can not find a full-time post, edged up to 7.5 per cent from 7.4 per cent in August. State education added 21,200, an extraordinary gain, since employment had been virtually flat over the prior year, although this may be partly a problem in seasonal adjustment. That's up from $26.51 in September of 2017. First, the Bureau of Labor Statistics' first estimate of September non-farm payroll growth has consistently underperformed expectations only to be revised up in subsequent reports, a pattern similar to August (Chart 5). This year's monthly average is ahead by almost one-quarter (+22.9%) compared with January-September 2017.

Within healthcare, hospitals showed the most employment growth last month, adding 3,800 more jobs than the 8,200 added in August. Our research shows that the potential labor supply is sizable and elastic, especially along prime working-age persons.


Extending losses for second straight session, the US markets ended lower on Friday on worries about runaway inflation spurred by the sudden jump in US Treasury bond yields.

The latest Canadian figures on average hourly and average weekly earnings for all employees are +2.4% and +2.2% respectively. The 2018 year-to-date gain is 189,000 compared to 207,000 for 2017.

According to the department, total nonfarm payroll employment increased by 134,000 and job gains mainly occurred in professional and business services, health care, transportation and warehousing. The views expressed in this column are the author's own and do not reflect those of Berenberg Capital Markets, LLC.

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