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Winter Is Coming: August Jobs Report Weak, Average Annual Earnings Growth Remains at 2.5% YoY (U-3 Unemployment Rate BELOW Natural Rate of Unemployment)

This is a syndicated repost published with the permission of Snake Hole Lounge. To view original, click here. Opinions herein are not those of the Wall Street Examiner or Lee Adler. Reposting does not imply endorsement. The information presented is for educational or entertainment purposes and is not individual investment advice.

August jobs reports are always a little odd. And August 2017 is no different. Only 156K jobs were added in August and the U-3 unemployment rate rose slightly to 4.4%.

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Average hourly earnings remained the same at 2.5% YoY.

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But the U-3 unemployment rate is once again lower than the NATURAL rate of unemployment and wage growth should be rising, but isn’t.

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The Labor Force Participation Rate and Employment to Population Ratio have not been the same since Q3 2007.

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Total nonfarm payroll employment increased by 156,000 in August. Job gains occurred in
manufacturing, construction, professional and technical services, health care, and mining. Employmentgrowth has averaged 176,000 per month thus far this year, about in line with the average monthly gain of 187,000 in 2016. 

Manufacturing employment rose by 36,000 in August. Job gains occurred in motor vehicles and parts (+14,000), fabricated metal products (+5,000), and computer and electronic products (+4,000). Manufacturing has added 155,000 jobs since a recent employment low in November 2016.

In August, construction employment rose by 28,000, after showing little change over the prior 5 months. Employment among residential specialty trade contractors edged up by 12,000 over the month.

Employment in professional and technical services continued to trend up in August (+22,000) and has grown by 262,000 over the last 12 months. In August, job gains occurred in computer systems design and related services (+8,000).

Health care employment continued on an upward trend over the month (+20,000) and has risen by 328,000 over the year. Employment in hospitals edged up over the month (+6,000).

Mining continued to add jobs in August (+7,000), with all of the growth in support activities for mining. Since a recent low in October 2016, employment in mining has risen by 62,000, or 10 percent.

Employment in food services and drinking places changed little in August (+9,000), following an increase of 53,000 in July. Over the year, the industry has added 283,000 jobs.

Employment in other major industries, including wholesale trade, retail trade, transportation and warehousing, information, financial activities, and government, showed little change over the month.

Actually, winter for jobs came in 2008 and never quite recovered.

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