The US economy added 162,000 jobs in August, significantly exceeding economists’ expectations as the unemployment rate remained unchanged at 4.1%, according to new federal data released Friday.
Economists surveyed by LSEG had expected payrolls to increase by just 56,000, meaning the actual gain came in nearly three times higher than forecast. The source article characterized the numbers as a sharp rebound from the initially weak July report.
The Bureau of Labor Statistics reported that total nonfarm payroll employment rose by 162,000 during the month, well above the average monthly increase of 31,000 recorded over the previous 12 months.
The unemployment rate remained at 4.1%, matching economists’ expectations. The labor force participation rate increased from 61.4% in July to 61.6% in August, according to BLS data.
Friday’s report also included significant upward revisions to the previous two months.
June’s payroll gain was revised from 20,000 to 31,000, an increase of 11,000 from the initial estimate. July underwent a larger revision, changing from a previously reported loss of 23,000 jobs to a gain of 21,000.
Combined, the revisions mean the economy added 55,000 more jobs in June and July than previously reported.
Private-sector employers accounted for 127,000 of the jobs added in August, according to the source report, compared with the 45,000 increase economists had anticipated. July’s private-sector increase was also revised higher, from 30,000 to 71,000.
Government employment increased by 35,000 during August. Local governments added 50,000 positions, including 42,000 jobs in education, while federal employment declined by 5,000 and state government payrolls fell by 10,000.
Restaurants and bars recorded one of the largest increases of the month, adding 59,000 jobs. That was substantially higher than the industry’s average monthly gain of 12,000 during the preceding year.
Manufacturing employment also increased, adding 16,000 jobs during August, according to the source report. July’s manufacturing increase was revised upward from 5,000 to 14,000.
Healthcare employment rose by 13,000, including increases in home healthcare services and hospitals.
The gains were not spread evenly across the economy.
Information-sector employment declined by 23,000 in August, considerably larger than its average monthly loss of 8,000 over the preceding year. Computing infrastructure, data processing and related services lost 8,000 positions, while publishing shed 7,000 and broadcasting and content providers lost 5,000.
Construction employment changed relatively little overall, although the industry added 22,000 jobs, including 8,000 positions among nonresidential specialty trade contractors.
Wages also increased during the month. Average hourly earnings for private nonfarm workers rose 10 cents, or 0.3%, to $37.75. Average hourly earnings were 3.1% higher than a year earlier, per Trending Politics.
The stronger-than-expected employment report immediately affected expectations surrounding Federal Reserve policy. Reuters reported that financial markets increased their expectations for an interest-rate hike at the Fed’s September meeting following the release.
Treasury yields moved higher following the report, while the dollar initially strengthened. Investors are now looking toward upcoming inflation figures as another major factor in the Fed’s decision.
The August numbers represent a notable improvement from July’s initially reported contraction and give the Trump administration a stronger labor-market report heading into the fall. The official BLS figures show both substantially stronger August hiring and upward revisions to the prior two months.
