Finance: Jobs report misses, unemployment rate climbs

The pace of job creation was expected to slow in August.

Job creation in the US slowed in August after a stronger start to the summer, and the unemployment rate ticked up from a 16-year low.

A report Friday from the Bureau of Labor Statistics showed that the US economy added 156,000 jobs in August, fewer than economists had expected. The unemployment rate rose to 4.4% from 4.3%.

Economists had forecast that the pace of job creation slowed to a net total of 180,000 nonfarm payrolls, according to Bloomberg.

The BLS subtracted 41,000 jobs from its initial estimate of the prior two months.

It noted that Hurricane Harvey had "no discernible effect" on the August jobs numbers because it conducted the survey for its report before the storm. The hurricane's impact is likely to show up in a few weeks in initial filings for unemployment claims.

Manufacturing stuck out as a strong sector last month, adding 36,000 payrolls. Retail hiring increased for a second straight month, but by just 800 jobs amid mass store closures.

Wage growth was expected to pick up slightly but remain sluggish. That's partly because baby boomers are retiring and being replaced by young workers with low-paying jobs.

Average hourly earnings rose 0.1% month-on-month, softer than expected, and 2.5% year-on-year, both weaker than expected.

The lack of wage growth is puzzling since the unemployment rate is so low, and may give the Federal Reserve some hesitation to raise interest rates. The Fed meets later this month to decide on whether to raise borrowing costs, although economists don't expect that it will hike.

More to come ...

The pace of job creation was expected to slow in August. Read Full Story