While the unemployment rate unexpectedly increases, the US economy added 187,000 jobs in August.

In August, the pace of job growth in the United States continued at a moderate rate, but there was an unexpected uptick in the unemployment rate. This development signals that the labor market is beginning to cool off in response to increasing interest rates and persistent inflation.According to the monthly payroll report released by the Labor Department on Friday, employers added 187,000 jobs in August. This figure exceeded the forecast of 170,000 jobs predicted by Refinitiv economists.

However, a separate report based on a household survey portrayed a slightly different labor market scenario. It indicated that the unemployment rate rose from 3.5% to 3.8% as the labor force participation rate reached a nearly three-year high. This marks the highest unemployment rate since February 2022 and the most significant increase since the early days of the COVID-19 pandemic.

The report also included substantial downward revisions to job growth figures for earlier in the summer. The government revised down job gains for June and July by a total of 110,000 jobs, bringing them to 105,000 and 157,000, respectively. This suggests that the labor market might be weaker than previously perceived.

Article Credited By: Fox Business