What employers need to know about the September jobs report
The monthly jobs reports released by the U.S. Bureau of Labor Statistics provides a great snapshot of the state of the economy. Between global turbulence and trade war uncertainty, economists and employers alike tuned in for the latest hiring and unemployment figures on Friday.
According to the report, the economy added a steady 136,000 jobs last month. Meanwhile, the unemployment rate dropped to 3.5%, and average hourly wages were little changed. Here are the headlines from September’s report.
1. Hiring Remains Steady
The labor market continues to hum along, expanding to the tune of 136,000 jobs in September. While this number falls slightly short of Wall Street estimates of about 145,000, it’s very close to the 135,000 private sector jobs reported by payroll processor ADP earlier this week. The BLS jobs report also showed an increase of 45,000 jobs from the last two months than what was previously reported.
While economic growth continues to be slower this year than last year—averaging 161,000 jobs per month so far in 2019 compared to the monthly gain of 223,000 in 2019—it would need to dip below 100,000 in order to be considered unhealthy. “The private-sector service side has been robust,” Ellen Zentner, chief United States economist at Morgan Stanley, told the New York Times. “The labor market held up.”
2. Holiday Hiring Focuses on Transportation Sector
According to the BLS report, employment in retail trade declined by 11,000, after seeing similar declines a month prior. This comes as little surprise, as Coresight Research recently reported the closure of 8,558 retail stores so far in 2019, with expectations of 12,000 closures by the end of the year.
Despite retail hiring continuing to shrink, employment in transportation is growing. The BLS report showed gains of 16,000 jobs in the sector last month. With the rise of ecommerce and holiday hiring in full swing, it’s clear to see the shift from retail positions like merchandisers and cashiers to transportation and warehousing jobs—many of which employers, including the United States Postal Service, UPS, and FedEx, say will turn into full-time opportunities.
Likely due to the tightening labor market, employers are already scoping the job market for holiday talent. With some employers, like Kohl’s and Lowes, starting as early as July, holiday hiring will only become more competitive as it ramps up in the weeks ahead. As demand for more workers increases, employers should consider training these seasonal workers for permanent, full-time careers.
3. Unemployment Rate Drops to 50-Year-Low
While the unemployment rate has held at 3.7% for the past three months, it dropped two percentage points in September to 3.5%. According to the BLS, the last time the unemployment rate was this low was in December 1969, when it was also 3.5%. Another measure of unemployment and underemployment, which includes those too discouraged to look for work or those who want full-time work but are stuck in part-time jobs, fell from 7.2% to 6.9% in September. That is the lowest level since December 2000.
The reason for the lower unemployment rate is likely due to more people finding work. The number of working-age people with a job hit 80.1% in September—the highest level since March 2007. As unemployment remains low, employers will need to prioritize retention in order to be sustainable in the labor market.
4. Wages were a Penny Short
While wage growth has been steadily increasing month-over-month, things took a slight dip in September. A penny less than August, average hourly wages were little changed at $28.09. Wage growth dropped from 3.2% to 2.9% for the year—the slowest pace in 14 months. However, it’s important to note that the 2.9% climb is still higher than inflation.
The next jobs report will be released on November 1, 2019, at 8:30 a.m. EST. In the meantime, see how Monster can help drive job growth at your organization with Monster Hiring Solutions.