August US Jobs Report: 142,000 Rise in Payrolls, Softer Than Expected

The US economy added a weaker-than-expected 142,000 jobs in August, according to the latest report from the Bureau of Labor Statistics. The report also revised down previous estimates for new job creation in July and June.

Following the report, bond traders raised the odds of the Federal Reserve cutting interest rates by a more aggressive half-point at its September meeting. Expectations previously centered on a quarter-point cut.

The unemployment rate ticked down to 4.2% in August from 4.3% in July.

Economists had predicted the economy would add 160,000 jobs in August, according to FactSet’s consensus. Meanwhile, the unemployment rate had been forecast to drop to 4.2%.

August Jobs Report Key Stats

• Total nonfarm payrolls increased by 142,000 versus a downward-revised 89,000 in July.
• The unemployment rate edged down to 4.2% from 4.3% in July.
• Average hourly wages rose by 0.4% to $35.21 after rising 0.2% in July.

In August, average hourly wages climbed by 14 cents, or 0.4%, to $35.21. Over the past 12 months, average hourly earnings have increased by 3.8%.

The average workweek for all employees on private nonfarm payrolls increased to 34.3 hours in August from 34.2 hours in July. For manufacturing employees, the average workweek increased to 40.1 hours in August, and overtime grew to 3.1 hours. For production and nonsupervisory employees, the average workweek extended to 33.8 hours from 33.7 the prior month.

In the wake of the report, the CME FedWatch tool gives the Fed essentially equal odds of cutting its interest rate target by either a quarter-point or a half-point from its current range of 5.25%-5.50%.