On Friday, the Labor Department reported that the economy added 248,000 jobs in September, corrected slightly from the disappointing report in August. The unemployment rate edged lower, falling to 5.9%, but part of the drop in unemployment is due to 315,000 people leaving the labor force in September.
September job gains were slightly higher than economists had predicted. Consensus estimates were for the economy to gain about 215,000 jobs. Job growth in July and August was also revised upward. The September report returns the economy to the “new normal” of monthly job growth slightly above the 200k threshold. This level is important, as it allows the economy to merely keep up with population growth. The working population of the country grew by 217,000 people in September.
Wages were flat. Average hourly earnings were unchanged, while average weekly earnings dipped 0.1%. The number of hours worked each week was also flat. The lack of wage growth signals a continued weak job market, with little pressure on employers to raise wages to attract needed workers.
The economy continues to be stagnant, with job growth just keeping up with organic population growth. In our world of declining expectations, the Labor Department report is a “good” number. The unemployment rate did drop, but it’s driven as much by people giving up the prospect of work as people finding good jobs.