Calay News
The unemployment rate has experienced an increase, standing at 3.8%, compared to 3.5% registered in July. Despite this increase, 187,000 jobs were created, exceeding the expectations of analysts who anticipated the creation of 170,000 jobs.
It is important to note that the employment data for June and July were revised significantly downwards, with a decrease of 110,000 jobs compared to the initial reported figures. In June, 105,000 jobs were created instead of the 185,000 initially announced, while in July, the figure was adjusted to 157,000 instead of 187,000.
The Department of Labor reported that employment continued to increase in sectors such as health services, recreation, hospitality, social assistance, and construction, while employment in transportation and logistics decreased during the same period.
The increase in the unemployment rate is attributed to the fact that the economically active population grew by more than half a million people during August. According to Rubeela Farooqi, chief economist at High Frequency Economics, wages have slowed and the unemployment rate has reached its highest level since February 2022 due to the sharp increase in the active labor force.
The labor shortage that has persisted since the start of the COVID-19 pandemic has led employers to raise wages, which is good for workers but has contributed to rising inflation. For inflation to return to acceptable levels on a sustainable basis, US Federal Reserve Chairman Jerome Powell has expressed the need for “relaxing labor market conditions.”
