Total U.S. nonfarm employment grew in September for the 60th consecutive month as 142,000 jobs were created, accelerating from the 136,000 jobs that were created the previous month. However, the September tally marked just the fourth time in the last 19 months that job gains failed to surpass the 200,000 level. Additionally, job totals were revised downward for the previous two months by a combined 59,000. In September, the private sector expanded for a record 67th consecutive month, adding 118,000 jobs, while the government sector gained 24,000. Although falling in eight of the last 14 months, the unemployment rate held steady in September at a seven-plus-year low of 5.1 percent, and was 0.8 percentage points below its rate of a year ago. However, with 350,000 workers exiting the labor force in September, the labor force participation rate dipped to 62.4 percent, matching the lowest rate in 38 years (October 1977). The number of planned job cuts announced by U.S. companies surged 43.0 percent in September, led by Hewlett-Packard’s 30,000 jobs cuts. Planned jobs cuts were up 93.2 percent year-over-year and are on track to end the year as the highest annual total since 2009. The Labor Department reported that the average work week edged down in September by 0.1 hour to 33.6 hours and was down 0.1 hour year-over-year.
Total nonfarm payroll employment expanded for the 60th consecutive month, increasing by 142,000 in September, accelerating slightly from the 136,000 jobs that were created the previous month. September’s tally marked just the fourth time in the last 19 months that job gains failed to surpass the 200,000 level. Additionally, the job figures for July were revised downward from 245,000 to 223,000, and those from August were revised downward from 173,000 to 136,000. Job growth during the 60-month expansionary streak has averaged approximately 201,000 jobs per month. Economists believe that approximately 125,000 jobs must be created per month just to keep up with new workers entering the workforce. Led by job gains in health care (+34,000), professional and business services (+31,000), retail trade (+24,000), food services and drinking places (+21,000), and information (+12,000), private-sector payroll employment increased for the 67th straight month, rising by 118,000 in September after gaining 100,000 the previous month. Approximately 13.2 million jobs have been created in the private sector over the last 66 months, an extension of the longest streak on record for private sector job growth. Meanwhile, government employment has declined in 37 of the last 64 months although gained 24,000 jobs in September and has risen in seven of the last eight months. Over this 64-month period, government employment has fallen by about 1.0 million. The economy (both the private and government sectors) has fully recovered the 8.7 million total jobs lost between the start of the recession in December 2007 and February 2010 plus has created an additional 4.0 million jobs.
The unemployment rate held steady in September at a seven-plus-year low of 5.1 percent (lowest since April 2008), but has fallen in eight of the last 14 months and was 0.8 percentage points below its rate of a year ago. The underemployment rate (a.k.a. U-6 unemployment rate), a measure of labor underutilization which accounts for part-time workers due to economic reasons as well as discouraged job seekers, dipped 0.3 percentage points to 10.0 percent in September, representing a seven-plus-year low (lowest since May 2008). Moreover, the underemployment rate has declined in 12 of the last 14 months and was down 1.7 percentage points from a year ago.
With the household survey showing that only 350,000 workers exited the labor force in September, the labor force participation rate, the share of working-age people (16 years and older) in the labor force declined to 62.4 percent, matching the lowest rate in 38 years (since October 1977) when Jimmy Carter was president. The aging of America, a modest jobs recovery from the last recession which has kept workers in school longer, and the rising number of workers on disability insurance are theories offered to explain the fall in the labor participation rate since it peaked at 67.3 percent in 2000.
The number of long-term unemployed (jobless for 27 weeks and over) declined in September from 2.2 million to 2.1 million, representing 26.6 percent of the unemployed population. Since April 2010, the number of long-term unemployed has fallen by about 4.6 million, and in the last year, by approximately 0.8 million.
The Labor Department reported that the average work week for production and nonsupervisory employees on private nonfarm payrolls edged down 0.1 hour in September to 33.6 hours and was down 0.1 hour year-over-year.
Challenger, Grey & Christmas reported a surge in the number of planned job cuts by U.S. companies in September, jumping 43.0 percent, after plunging 61.0 percent the previous month from a 46-month high. Planned jobs cuts were also up a whopping 93.2 percent year-over-year. The computer industry saw the heaviest job cuts in September, as Hewlett-Packard announced plans to reduce its workforce by as many as 30,000. In all, the industry saw 32,500 job cuts during the month, marking the highest one-month total for this industry since IBM announced 60,000 job cuts in 1993. For the year, the biggest job cutting sector is energy, which has announced 72,708 job cuts; however, most of the energy cuts occurred in the first half of year. CEO of Challenger, Gray & Christmas said, “Job cuts have already surpassed last year’s total and are on track to end the year as the highest annual total since 2009, when nearly 1.3 million layoffs were announced at the tail-end of the recession. While oil cuts have slowed, the issues that helped drive oil prices down in the first place are still impacting the economy. We continued to see the ripple effect of low demand last month when heavy-equipment maker Caterpillar announced plans to reduce its workforce over the next year-and-a-half.”