USA unemployment rate falls to 50-year-low of 3.5%


The economy grew at a 2.0 per cent pace in the second quarter, slowing from a 3.1 per cent rate in the January-March period.

The Bureau of Labor Statistics' Friday jobs report showed that the United States unemployment rate hit a 50-year low, falling to 3.5% in September. Professional and business service roles rose by 34,000 during the month.

The additional hiring and the drop in the jobless rate will likely ease worries that an economy weakened by the U.S. Weak wage growth increases the likelihood that the secretive Federal Reserve bank will cut interest rates for the third time in four months at its meeting later this month.

The Fed has defended that strategy as a way to strengthen the economy in the context of a slowdown in global growth, particularly in China and in Europe, and the uncertainty surrounding world trade. Businesses expressed concern about tariffs, a shortage of workers and the direction of the economy. Economists polled by Reuters had forecast payrolls would increase by 145,000 jobs in September.

These factors, together with benign wage inflation, are likely to prompt the Federal Reserve to cut interest rates at least one more time this year, economists said. Stocks nevertheless posted strong gains following the report, but overall, are still down for the week.

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Despite cracks showing in the economy, hiring has always been a bright spot. Consumer spending continues to help pace the economy, even as business investment has pulled back. BLS's Job Openings and Labor Turnover Survey shows 7.2 million open jobs as of the last day of July (the latest data available), which is over 1.1 million more than the number of people unemployed in July.

The speed of participation within the labor drive, which is to say the proportion of Individuals who're both employed or in search of employment, remained steady at 63.2 % in September.

The unemployment rate for Latinos fell to 3.9%, the lowest on records dating from 1973.

"We were going to build a new building, and add a restaurant and bar, which would have expanded our employment significantly", Lix said.

However, the massive GM strike, in which about 50,000 people joined picket lines, was not counted in this month's report. "We're hitting the point where we're going to have to see wage growth, or employers aren't going to find workers they need". In 2018, that figure was 223,000 per month. These companies pledged to create upwards of 14 million new job and training opportunities through education and reskilling initiatives for current and future employees over the next 5 years. "But even with a strong labor market, wage growth remains muted, limiting the risk that labor market tightness with push inflation meaningfully higher".