U.S. nonfarm payrolls increase less than forecast in August

The U.S. Labor Department announced on Friday that nonfarm payrolls rose by 1,371,000 in August after a downwardly revised 1,734,000 advance in the prior month (originally a gain of 1,763,000), reflecting the continued resumption of economic activity that had been curtailed due to the coronavirus pandemic and efforts to contain it.

According to the report, employment rose sharply in government (+344,000 jobs, largely reflecting temporary hiring for the 2020 Census), retail trade (+249,000), in professional and business services (+197,000), in leisure and hospitality (+174,000), and in education and health services (+147,000).

The unemployment rate fell to 8.4 percent in August from 10.2 percent in July.

Economists had forecast the nonfarm payrolls to increase by 1,400,000 and the jobless rate to drop to 9.8 percent.

The labor force participation rate increased by 0.3 percentage point in August to 61.7 percent, while hourly earnings for private-sector workers rose 0.4 percent m-o-m (or $0.11) to $29.47, following a revised 0.1 percent m-o-m increase in July (originally a gain of 0.2 percent m-o-m). Economists had forecast the average hourly earnings to be unchanged m-o-m in August. Over the year, average hourly earnings increased by 4.7 percent in August, following a revised 4.7 percent rise in July (originally an increase of 4.8 percent).

The average workweek increased by 0.1 hour to 34.6 hours in August, exceeding economists' forecast for 34.5 hours.