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The economy added just 22,000 jobs in August, well below expectations. The unemployment rate ticked up to 4.3%.
The prediction was that the number would come in at 75,000.
Meantime, job gains in the prior two months were both revised, with job creation in June revised down by 27,000 from a gain of 14,000 to a loss of 13,000; and July job creation was revised up by 6,000 from a gain of 73,000 to 79,000. Taken together, employment in June and July was 21,000 jobs lower than previously reported.
Private payrolls added 38,000 jobs in August, well below the gain of 75,000 jobs projected by LSEG.
Government payrolls declined by 16,000 jobs. Federal government employment fell by 15,000 jobs, while state governments shed 13,000 jobs. Those job losses were partially offset by gains of 12,000 jobs in local government, most of which were in education. Federal employment is down 97,000 jobs since its January peak, and the BLS noted employees on rapid leave or receiving severance pay are counted as employed in the establishment survey.
All of this sets up what is expected to be the first interest rate cut of the year later this month. President Donald Trump has blasted Federal Reserve Chairman Jerome Powell for holding the line on rates.
The Fed meeting is scheduled for the 16th and 17th of September.