September Jobs Report: America’s Still Hiring, Unemployment Down To Pre-Pandemic Levels

Today’s monthly jobs report shows continued job growth, with the economy adding 263,000 new jobs in September, and the unemployment rate edging down a bit from 3.7 percent in August to 3.5 percent. We’re now fairly solidly back to the unemployment rates that were common before the pandemic hit in 2020. The 22 million jobs that were vaporized by the pandemic recession were finally restored as of July, although now we can start worrying that the Federal Reserve’s efforts to contain inflation by raising interest rates may edge the economy into recession.

Macroeconomics is nutty, isn’t it?

The September jobs report may indicate that the Fed’s interest rate hikes may be cooling the economy some, since this was the smallest increase in new jobs since April 2021 — although more than a quarter million new jobs is also nothing to sneeze at, either. As the mandatory economist quote at CNBC suggests, the bizarre logic of interest rate fiddling means that to cool inflation, slower growth is good, but also the stock market freaks out when growth slows, even if that’s what the Fed is after, and honestly it’s enough to give anybody a headache:

“Depending on your view of optimism vs. pessimism, on the economy, there’s a little bit of something for everyone in this report,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. “Obviously, the market is not happy, but the market is not happy in general these days.”

Another economist, Jeffrey Roach of LPL Financial, said the jobs report

really just shows that the consumer and corporate side have been very resilient despite the headwinds of the Russia-Ukraine war, rising interest rates and slowing housing market. […] It could add to the story of a soft landing [for the economy] that for a while seemed fairly elusive.

So that sounds hopeful, although CNBC also says Fed-watchers expect another interest rate hike in November anyway, which would likely mean lower jobs gains or possibly even increased unemployment, but also lower inflation, and this is why I am glad I got a liberal arts degree instead of pretending economics is anything but just voodoo.

A bit of good news, from the summer, if solid job gains are good news: In revisions based on new data, the good jobs reports from July and August remained about where they had been, with July’s amazing gain of 526,000 being revised up by 11,000 to 537,000, while August’s job gains of 315,000 remained unrevised. We just might be past those wild lags in employers getting data to the BLS that made the jobs reports so crazy during the pandemic? The BLS also noted that because its monthly surveys were completed before Hurricane Ian hit Florida, the September numbers were unaffected. That means any job losses due to the hurricane — or gains from the reconstruction — won’t be reflected until the October report, with likely revisions needed after that due to the chaos.

So: In short, jobs still growing. That’s wonderful or terrible, hooray/boo!

[Bureau of Labor Statistics / MarketWatch / CNBC]

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