U.S. Adds 142,000 Jobs In August As Focus Turns To Fed Rate Cut; Showbiz Employment Continues Drop

The U.S. economy added 142,000 jobs in August, with the unemployment rate at 4.2%, as the focus has turned to the Federal Reserve’s expected cut in the prime interest rate this month.

The top gains in employment were in construction and health care.

The movie and sound recording industries continued to see job losses during the month, shedding 4,200 positions to 444,300. Publishing industries lost 3,700 jobs to 916,700, and broadcasting and content providers lost 1,200 jobs to 337,500. The figures are estimates from the Department of Labor’s Bureau of Labor Statistics, and are typically adjusted as more data comes in.

While the overall job gains were further indication that the economy is not in recession, analysts have watched the employment picture and sounded the alarm over a hiring slowdown. That has put pressure on the Federal Reserve to start cutting rates, with some economists believing that the central bank has waited too long to do so. The question seems to be not whether the Fed will cut the rate this month, but by how much.

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Justin Wolfers, professor at the University of Michigan, wrote on X that the fact that payrolls grew and that the unemployment rate fell slightly was good news. More concerning, he wrote was that figures for the two previous months were revised down.

Jason Furman, Harvard professor and chair of the Council of Economic Advisers under President Barack Obama, called the overall picture “reassuring.” He noted that nominal wage growth has not been slowing, and, if anything, has actually picked up.

“This is more like what you would expect to see in a 3.5% inflation economy than the 2.5% inflation economy we think we’re in,” he wrote on X.

He added, “In sum, this is a nice economy to have. The job market is chugging along nicely. Prime age employment has risen. But policymakers should always worry about risks. With this report recession risk down a little and inflation risk up a little. But recession still the bigger risk.”