LOS ANGELES, CALIFORNIA - JUNE 02: A 'Now Hiring' sign is displayed outside a resale clothing shop on June 2, 2023 in Los Angeles, California. Todays U.S. labor report shows that employers added 339,000 jobs in May with sectors including construction, healthcare, business services and transportation adding jobs with wages showing 4.3 percent growth over the same period last year. Mario Tama/Getty Images/AFP (Photo by MARIO TAMA / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
Job growth in the United States slowed more than expected in August, while the unemployment rate dipped slightly to 4.2%, according to official statistics released this Friday. This comes ahead of a crucial Federal Reserve meeting later this month to determine interest rates.
The U.S. Department of Labor reported the creation of 142,000 non-farm jobs in August and revised July’s numbers downward. The rebound in employment growth compared to the lower levels earlier this summer signals that the Federal Reserve might be on track to cut interest rates during its next meeting.
July’s job data had sparked concerns of a slowdown, leading to disruptions in global financial markets. Additionally, the Department of Labor revised its job creation estimates for June and July, reducing the total by 86,000 jobs.
The Wall Street Journal noted that this report doesn’t completely eliminate doubts about the size of the expected rate cut, which may vary between a traditional quarter-point cut or a more aggressive half-point cut to prevent an unwanted slowdown in the labor market. After the release of the job data, New York Fed President John Williams reiterated that a rate cut was imminent.
