Job creation edged lower in September as the labor market showed there still may be room to run.
Nonfarm payrolls increased 156,000 for the month and the unemployment rate ticked up to 5 percent, the Bureau of Labor Statistics reported Friday. Economists surveyed by Reuters had expected 176,000 new jobs and the jobless rate to hold at 4.9 percent. The total was a decline from the upwardly revised 167,000 jobs in August (compared with the original number of 151,000).
“This is within the broad range of expectations,” said Mark Hamrick, senior economic analyst at Bankrate.com. “The main point is, slow and steady does win the race for this recovery, which began in the summer of 2009.”
Average hourly wages pushed higher, rising 6 cents to an annualized rate of 2.6 percent. The average work week also inched up one-tenth to 34.4 hours.
A broader measure of unemployment that includes those who have stopped looking for jobs as well as those working part-time for economic reasons was unchanged at 9.7 percent.
The number of workers considered not in the labor force fell by 207,000 to 94.2 million, the number in the labor population surged by 444,000 and the level of the employed jumped by 354,000, according to the household survey. The employment-to-population ratio rose to 59.8 percent, a half-percentage point gain from a year ago.
Professional and job services led the way with 67,000 new jobs while health care added 33,000 and restaurants and bars contributed 30,000.
The report comes at a critical time for the Federal Reserve as the U.S. central bank looks to resume getting rates back to normal. The Fed last hiked rates in December, the first such move in more than nine years. However, it has held off since then amid a variety of global and domestic concern.
Traders expect the Fed to hike again in December.
“This is a solid number,” Cleveland Fed President Loretta Mester told CNBC. “This is very consistent with what we expected to see, certainly with my forecast.”
Traders pushed chances for a December rate hike higher, from 63.9 percent prior to the payrolls report to 70.2 percent afterward.