Unemployment Rate at 50 Year Low of 3.7%

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Total payrolls, including all non-farm employment, have inched steadily upward with private job creation leading the way.

Investors scrambled to figure out the non-farms payroll report released this morning for the month of September and whether it would move the needle on the Federal Reserve rate hikes. The headline number of 134,000 jobs added was a miss and the lowest number in a year, but Hurricane Florence may have been a factor and the upward revisions of the previous two months were up 87,000. Therefore, job growth is still quite healthy. The unemployment rate ticked down to 3.7%, the lowest rate in almost 50 years. The more comprehensive U6 rate which includes people marginally attached to the workforce rose up to 7.5%. Growth in the average hourly earnings remained around 2.8%. Wage inflation is not yet an issue - the labor market is tight but there are still 96 million U.S. civilians not in the workforce. Overall, this was a strong report and an affirmation of the robust economy. There is certainly nothing in this report that would give reason for the Fed to pause. In addition, the ADP private payrolls report was a blowout and the latest ISM non-manufacturing measure of the services sector was the highest reading on record.

Please watch the payrolls reports on page 63 of the Global Perspectives Book.

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