The US labor market was unexpectedly robust in September. Experts were particularly surprised by the strong increase in employment. The number of non-agricultural employees rose by 336,000, the Labor Ministry announced on Friday. This is the strongest increase in employment since the beginning of the year. Economists now believe that the Fed will raise interest rates further.
Experts had expected an average of 170,000 new jobs. New jobs were created, particularly in the leisure sector and in the catering industry. The government also created many jobs.
The unemployment rate remained at 3.8 percent, while economists had expected a slight decline. The rate has been below the 4 percent mark since the beginning of 2022.
Companies complain about a labor shortage
Many companies complain about a labor shortage. The labor market is also important for the Fed’s interest rate policy. The overall strong data makes the fight against inflation more difficult. A robust labor market also tends to support wage developments.
The Fed did not raise interest rates at its most recent meeting – but did not rule out further increases. She also made the further course of action dependent on developments on the labor market. “The robust labor market is now putting central bankers in Washington in trouble,” commented Thomas Gitzel, chief economist at VP Bank. “This makes an interest rate increase in November more likely.” The strong workplace structure makes the risk of overheating clear.
