NEW YORK (Reuters) - Jobs growth in the United States was stronger than expected in September thanks to private sector growth, easing fears the economy is slipping back into recession — but the unemployment rate was unchanged.
Non-farm payrolls rose 103,000, according to the Labor Department, while the unemployment rate held steady at 9.1 per cent as an increase in household employment offset a rise in the participation rate.
Part of September's relative strength reflected the return of 45,000 Verizon Communications workers who had dropped off payrolls in August due to a strike. Excluding those workers, payrolls increased by 58,000.
The tenor of the report was strengthened by revisions that showed 99,000 more jobs added in July and August than initially reported. In addition, hourly earnings rebounded and the average work week rose.
"You still got a pretty weak trend for payroll growth, 58,000 in September if you take out those (striking) Verizon workers. But, that being said, the upward revisions to the prior two months puts at a three-month moving average of 96,000,” said Ellen Zentner, senior U.S. economist at Nomura Securities in New York.
"Without those upward revisions, we had been expecting a three-month moving average of closer to 40,000. This shows that of the many factors that broadsided the economy in August, we were able to hang on in August and further create more jobs in September.”
The Labor Department’s report basically means the U.S. economy, rather than entering a double dip, is in neutral, said Robert Lutts, president and chief investment officer of Cabot Money Management.
"The markets will sigh a little bit of relief as this is bolstering the case we are not entering a double dip but sort of muddling through,” he said. "We have been seeing many companies announcing cutbacks, governments are cutting back, so we could see a couple more months of challenging employment data."
© Copyright Canadian HR Reporter, Thomson Reuters Canada Limited. All rights reserved.