The Economy

U.S. Adds Only 142,000 Jobs in September

The disappointing jobs report casts doubt on whether the Federal Reserve will proceed with an interest-rate hike this year.
Katie Kuehner-HebertOctober 2, 2015

The U.S. economy added only 142,000 jobs in September, well below experts’ predictions and possibly pushing an interest-rate hike into next year.

Economists surveyed by CNN had forecast a gain of 204,000 jobs. In a report released Friday, the Labor Department also revised down the number of jobs created in July and August by revised down by 22,000 and 37,000, respectively.

The unemployment rate stayed at 5.1% last month, its lowest level in seven years, but hourly wages for private-sector workers actually fell slightly.

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“It’s a very disappointing report across the board,” California State University economics professor Sung Sohn told CNN. “The U.S economy is really buckling under the pressure of a global economic slowdown.”

The U.S. Federal Reserve has been watching job growth closely as it decides whether to raise its key interest rate for the first time in almost a decade. It said last month that the economy’s post-recession recovery was still too fragile to risk a rate hike, but hinted it might go ahead by December.

“Unfortunately, today’s report will not give much reassurance to Fed policy makers,” Andrew Chamberlain, chief economist at Glassdoor Economic Research, told The New York Times.

Job growth in September was hurt by a decline in the labor force participation rate  a measure of how many people are working or looking for work  to 62.4 from 62.6. Moreover, average hourly earnings only rose 2.2% in September.

“While average hourly earnings have increased modestly this year, real wages remain virtually flat over the long term,” Labor Secretary Tom Perez wrote in a blog post. “Too many working families are finding economic stability more and more elusive. They are struggling to get by, let alone get ahead.”

With Friday’s revision, job gains have averaged just 167,000 a month for the past three months, compared with more than 200,000 over the previous 12 months.

“There’s nothing good in this morning’s report,” said Carl Tannenbaum, chief economist at Northern Trust in Chicago. “We had very low levels of job creation, wage growth isn’t budging and the unemployment rate would have risen if the labor force participation rate hadn’t fallen.”