US Economy Adds 157K Jobs In July, Unemployment Rate Drops To 3.9%

US jobs growth slows more than expected in July

July wasn't a stellar month for hiring in the US healthcare sector, with fewer jobs added in ambulatory care, hospitals and nursing facilities compared with a month earlier.

The Labor Department said the unemployment rate ticked down to 3.9 percent from 4 percent.

The additional signs of strength in the job market could add to concerns the Federal Reserve would move to raise the key lending rate more aggressively.

Job gains have averaged 215,000 so far this year, an acceleration from 2017 (182,000) and 2016 (195,000) averages.

Strong demand from consumers and businesses sharply reduced the stockpiles of goods held on many store shelves and warehouses.

The Hispanic unemployment rate dropped to 4.5 percent, the lowest level on record.

The US labour force participation rate (the share of the population 16 years and older either working or seeking work), which peaked at 67.1 percent in 2000, remained unchanged from the previous month at 62.9 percent. Increased labor market churn will place upward pressure on wages.

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The strategic plateau divides Israel and Syria, old foes, and saw decades of stable stand-off before the Syrian rebellion. It said the new Russian posts would be handed over to the Syrian government once the situation had stabilised.

Employment showed little or no change over the month in other major industries, including mining, wholesale trade, transportation and warehousing, information, financial activities, and government.

"We're going to create 2.6 million to 2.8 million new jobs in 2018", said Larry Kudlow, Trump's top economic adviser, on Fox Business shortly after the report came out. She said that even though hiring has picked up in manufacturing, it's still dwarfed by hiring in lower-wage industries.

Excluding those factors, hiring in July would have been closer to the monthly average this year.

Job gains were seen in the durable goods manufacturing and health care sectors as well as in restaurants and bars. Hospitals added 6,800 jobs in July, 36% fewer than the 10,600 new jobs added in June, a month that represented a massive hiring spike from sluggish May growth. Economists forecast that employers added 191,000 jobs in July, down from 213,000 in June but easily enough to lower the unemployment rate over time.

The overall recent surge of job gains may reflect, in part, confidence among some businesses that the Trump administration's tax cuts will accelerate growth - even though a growing roster of economic experts disagree with that assumption.

Mickey Levy is the chief economist for the United States, the Americas, and Asia at Berenberg Capital Markets, LLC and a member of E21's Shadow Open Market Committee (SOMC).

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