US September non-farm payrolls fall unexpectedly, US dollar heads lower

US September non-farm payrolls fall unexpectedly, US dollar heads lower

The September US non-farm payrolls data fell unexpectedly in September, as hurricanes Irma and Harvey both had a negative impact on jobs growth in Florida and Texas, the Bureau of Labor Statistics (BLS) said Friday.

According to the BLS, the number of jobs in the US fell 33,000 in September and the unemployment rate fell 0.2 percentage points to 4.2%. The August non-farm payrolls number was revised upwards to show 169,000 new jobs were added. The BLS previously reported a 156,000 rise.

Ahead of the data, expectations had been for the non-farm payrolls number to rise between 60,000 and 175,000.

In its data press release, the BLS said: "A sharp employment decline in food services and drinking places and below-trend growth in some other industries likely reflected the impact of Hurricanes Irma and Harvey.”

The US dollar moved lower against the British pound on the unexpected data result.

The surprise decline in the number of jobs in the US, follows generally positive indications from other surveys, including the ISM indexes. However, the BLS described the 33,000 fall, as “changed little.”

Other details of the report showed that there was a 105,000 drop in the number of jobs in ‘food and drinking’ places, during September. However, some 23,000 new roles were added in the healthcare sector, while 22,000 new jobs were added in the transportation and warehousing industry.

The BLS also reported that earnings rose by an average of 12 cents to $26.55 per hour.

While the disappointing non-farm payrolls data release may have led to some brief US dollar selling activity by investors, it won’t likely alter the upward path of interest rates the Federal Reserve has in mind.

Even despite the September decline, the BLS said the average monthly jobs increase stands at 172,000 per month, a strong number indicative of the ongoing economic recovery. 

By Ilona Billington
Ilona is a freelance writer and editor with over 15 years experience reporting and writing about UK and European economics, real estate, financial markets and central banks.

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