The United States monthly jobs report somehow always fails to top the Goldilocks goal where “everything is just right.”
But September’s Labor Department announcement on Friday had one bright, shining area: America’s jobless rate hit a 50-year low of just 3.5%, down from 3.7% in August. The December 1969 mark was also 3.5%.
Employers added 136,000 jobs in September and payrolls for August and July were revised upward by a combined figure of 45,000.
The headline applied by one newspaper was “Hiring slows; jobless rate drops.”
Another paper declared that “job gains and historically low unemployment have helped buffer the U.S. economy against weakness in manufacturing at home and abroad that have stoked concerns of a deepening slowdown.”
Job growth was steady in September but the economy lost some momentum, as the trade war hurt manufacturing and global growth cooled.
Clearly, the economy’s employment engine has lost some of its spark. In 2018, an average of 223,000 jobs were created each month, thanks in part to the temporary pick-me-up delivered by tax cuts and increased government spending. The average for the first nine months of 2019 is 161,000.
Friday’s report capped a week of otherwise disappointing economic news. Manufacturing activity in America fell for the second month in a row, while the World Trade Organization predicted that the growth in global trade would slacken significantly. A key measure of activity in the services sector – which accounts for two-thirds of the nation’s output — also dropped.
“It’s great news to hit a record low on unemployment,” Diane Swonk, chief economist at Grant Thornton, said. The tightening labor market, though, failed to lift wages: the 12-month growth rate fell to 2.9%, from 3.2% in August.
The jobless rates for Hispanics and for workers without a high-school diploma were the lowest on record. And many Americans who had dropped out of the labor force because they were too discouraged to look for work or couldn’t find sufficiently attractive offers, have now rejoined.
President Trump celebrated the September report, while taking a swipe at critics who want Congress to impeach him.
The Democrats’ efforts toward impeachment got under way at the end of September and played no role in the month’s employment figures but may be expected to cause some disruptions in the November and December end-of-the-year reports.
Trump has repeatedly placed manufacturing at the center of his economic strategy. Nonetheless, that sector is suffering the most from prolonged trade tensions. Companies -- in the business of making goods — as opposed to those that deliver services like hospitals and restaurants — are much more dependent on sales to other countries and supply chains that wend around the globe.
Manufacturers cut jobs last month for the second time this year.
Don’t count on 2020, an election year, to succeed in achieving the Goldilocks’ “just right” dream.