US jobs growth slows by more than expected in July
REUTERS
The US economy added 157,000 jobs in July - 33,000 fewer than expected and well below the 248,000 created in June.
Economists had forecast that the number of jobs created would be close to 190,000 for the month.
The unemployment rate fell from 4.0% to 3.9% in July, the US Department of Labor said, near to the 18-year low it reached in May.
Previous job gain estimates for May and June were revised upwardly, to 268,000 and 248,000 respectively.
The job figures follow data last week that showed the US economy grew at an annualised rate of 4.1% in the second quarter of the year.
The Department of Labor figures also showed average hourly earnings increased by 0.3% in July to $27.05, meaning they were up 2.7% from the same month last year.
Increasing hourly earnings are in part a result from a squeezed labour market, in which there are close to 6.6 million unfilled jobs across the nation.
Job gains occurred in the durable goods manufacturing and healthcare sectors as well as in the hospitality sector, but fell markedly at toy and game retailers.
Analysis
Paul Blake, US business reporter
It's far too early to tell if this dip is evidence that the "trade wars" between the US, China and other nations is starting to pinch the US economy.
Certainly over the long term, any disruptions to global supply chains could hurt jobs.
But this is just one number. Most economists pay attention to the three-month average of job growth, which sits now at 224,000, a healthy number suggesting a solid US labour market.
The other key figure in the minds of the markets will be average hourly earnings growth, now at 2.7%, year-over-year, suggesting that wage inflation is not accelerating.
That is not likely to prevent the Fed from hiking rates in September, but it's likely to calm any market anxieties that the speed of rate increases could accelerate.
Rate rises
Ian Shepherdson, chief economist at Pantheon Economics, said the data was "better than it looks" as the core, three-month trend was of an additional 200,000 jobs a month.
He also predicted that the figures would not push the US Federal Reserve off its course of steady interest rate increases.
"Overall, these numbers won't change the Fed's plans; unless the data over the next few weeks take a sudden, serious turn for the worse, the Fed will hike again next month".
The Fed has already increased its base interest rate twice this year, following meetings in March and June, and it now sits at between 1.75%-2%.
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