U.S. Job Growth Far Exceeds Estimates In August

(RTTNews) - Employment in the U.S. increased by far more than economists had expected in the month of August, according to a closely watched report released by the Labor Department on Friday.

The report said non-farm payroll employment surged by 162,000 jobs in August are rising by an upwardly revised 21,000 jobs in July.

Economists had expected employment to climb by 55,000 jobs compared to the loss of 23,000 jobs originally reported for the previous month.

The much stronger-than-expected job growth came as employment in food services and drinking places increased by 59,000 jobs in August, well above the average monthly gain of 12,000 jobs over the prior 12 months.

The Labor Department said local government education also rose by 42,000 jobs, while the information industry lost 23,000 jobs.

The report also said the unemployment rate came in at 4.1 percent in August, unchanged from July. Economists had expected the unemployment rate to tick up to 4.2 percent.

The unemployment rate came in unchanged as the household survey measure of employment spiked by 569,000 persons, while the labor force grew by 683,000 persons.

"The unemployment rate decreased for workers with less than a high school education, suggesting the jobs being created are lower-wage positions," said Mortgage Bankers Association SVP and Chief Economist Mike Fratantoni.

"This change in the mix of jobs is likely a factor in the slowdown in overall wage growth," he added. "Note that wage growth is running below the pace of inflation, which will depress back consumer spending if this persists."

The report said average hourly employee earnings rose by $0.10 or 0.3 percent to $37.75, while the annual rate of wage growth slowed to 3.1 percent in August from 3.2 percent in July.