US jobs grow at slowest pace in eight months

Washington, Sept 5: US job growth slowed down sharply in August and more Americans gave up the hunt for work, giving a cautious Federal Reserve more reasons to wait a bit longer before raising interest rates.

Nonfarm payrolls increased 142,000 last month, the smallest increase in eight months, the labour departmentsaidonFriday.The unemployment rate fell onetenth of a percentage point to6.1%aspeopledroppedout of the labour force.

June and July data were revised to show 28,000 fewer jobs created than previously reported, lending the weaker tone. In addition, manufacturing saw no job growth and retail payrolls declined for the first time since February.

Thesurpriseslowdownin job growth is at odds with labor market indicators such as first-time applications for unemployment benefits, which are hovering near their pre-recession levels.

In addition, manufactur- ing and service sector surveys showed strong employment growth in August and household perceptions of the labor market brightened significantly, which economists said were consistent with tightening conditions. Some economists had cautioned that August’s employment report could miss expectations because of seasonal factors. An upward revision to August data is most likely.

August’s employment report supports the Fed’s cautious approach to mone- tary policy.

Fed Chairman Janet Yellen is concerned about sluggish wage growth, the still-elevated numbers of Americans working parttime even though they want full-time employment, and Americans still suffering from a long spell of joblessness.

The US central bank has pointed to these metrics as evidence of “significant underutilization” of labor market resources that merits a stimulative monetary policy. Reuters