× Economy added just 210,000 jobs last month, far below expectations
President Donald Trump must be very disappointed.
The economy added just 210,000 jobs in September, according to the Labor Department’s closely watched monthly jobs report. Economists surveyed by CNNMoney had been looking for an additional 240,000 jobs.
That’s bad news for the Trump presidency. The unemployment rate rose to 3.9% from 3.8% in August.
But the report is also bad news for the Trump administration’s “great American jobs growth” theme.
September’s job growth was lower than August’s 304,000 increase, and well below the average of 325,000 new jobs per month for the first three quarters of the year.
The surprisingly poor number could cloud the outlook for Trump’s pledge to deliver 3% annual GDP growth.
A slow pace of job growth does hurt Trump’s agenda, because it means the economy can’t grow at that pace unless companies keep raising prices and wages.
The poor jobs report also gives political opponents another talking point. Democratic National Committee chair Tom Perez tweeted out figures showing almost 2 million fewer jobs gained since Trump was elected. He said Trump and the Republican Congress “made up excuses and hid from their record.”
The lack of strong job growth puts even more pressure on the Federal Reserve to tighten monetary policy. The Fed raised interest rates in September for the third time this year and will likely raise rates at a meeting next month. The Fed has signaled it is planning to raise rates three times in 2019, a rate hike cycle that has shaken stock markets around the world.
The slow job growth has impacted those who are struggling to find jobs. The number of people who counted as unemployed fell by only 28,000 from August to September, but the proportion of the population who are working dropped by almost 1% from the prior month to 62.7%.
Average hourly wages rose by 1.8% year-over-year, and by 3.1% over the past year. Those figures are slightly better than what the average hourly wage increases have been in recent months, and they also beat the consensus estimate of economists.
In addition to the weak jobs report, the Commerce Department also released a far-below-expectations report on Friday showing that U.S. second-quarter gross domestic product shrank at a 0.1% annualized rate, after growing at 2.6% in the first quarter. It was the weakest growth since the first quarter of 2017.