August payrolls rise 162,000, Fed rate hike odds in focus

The U.S. labor market added a surprising 162,000 jobs in August, according to data released Friday by the Bureau of Labor Statistics. Total nonfarm payroll rose by 162,000 positions, while data for July was revised up by 44,000 jobs, from -23,000 to +21,000 jobs. In total, the estimates for the prior two months were revised upwards by a combined 55,000 jobs. The unemployment rate remained unchanged at 4.1%, with 7.0 million people unemployed. “The unemployment rate remained at 4.1%, even though the labor force participation rate increased by two-tenths of a percentage point, indicating that more people were actively looking for work,” Mike Fratantoni, the Mortgage Bankers Association’s senior vice president and chief economist, said in a statement. “The unemployment rate decreased for workers with less than a high school education, suggesting the jobs being created are lower-wage positions, and this change in the mix of jobs is likely a factor in the slowdown in overall wage growth, which dropped to 3.1% in August. Note that wage growth is running below the pace of inflation, which will depress back consumer spending if this persists,” says Fratantoni. The food services (+59,000 jo...