US economy reports strongest monthly increase since September 2016
More jobs than expected in September, with the unemployment rate falling to 5.9 percent from 5.7 percent.
Analysts expect it to grow to 6.2 percent in the final three months of the year.
September employment is up by 6,200 jobs and the unemployment is down to 5 percent.
More broadly, the manufacturing sector is expected to add more than 100,000 jobs.
That’s the most since November 2015.
Analysts at Goldman Sachs and Bank of America predict that manufacturing will add about 200,000 new jobs in September.
A report by the US Labor Department released Monday said hiring in September rose at the slowest pace since October 2017.
The jobless rate, which is based on a questionnaire of workers who say they’re unemployed, was 6.7% last month, the lowest since March 2017.
“There’s no sign that it’s going to get much better this year,” said Robert Jones, chief US economist at Barclays.
The jobs report is likely to spark a debate about how quickly businesses can get back to full strength.
In the first nine months of 2018, the pace of hiring slowed by more than a quarter.
That was the steepest drop in more than three years.
Economists had been expecting that manufacturing would return to growth in September and then bounce back as more companies opened stores, hire more people and build warehouses.
In a report released Tuesday, Goldman Sachs said the labor market would get back on track over the course of 2018.
The jobs report will also likely prompt calls for Congress to boost tax credits to help workers buy goods and services, the analysts said.
“The economy is still far from full employment, and the Federal Reserve has been reluctant to raise interest rates, but a modest increase in the tax credits may help to stabilize the economy,” the analysts wrote.
President Donald Trump has argued for a more rapid increase in taxes to help the economy.
House Speaker Paul Ryan (R-Wis.) has been calling for higher taxes and more spending to stimulate the economy, while Trump has said that the tax cuts will be permanent and he wants to see them extended.