US non-farm payrolls fall by -33,000, prior months revised lower. But pay rises +2.9% and Fed expected to look past hurricane-distorted data to raise rates again

Overnight, the US employment report came in very weak in terms of employment levels.

Non-farm payrolls actually fell -33,000 in September from August which itself was a lowish +169,000.

That is the first fall since 2010.

The change in total nonfarm payroll employment for July was revised down from +189,000 to +138,000, and the change for August was revised up from +156,000 to +169,000. With these revisions, employment gains in July and August combined were -38,000 less than previously reported.

However, the September data weakness was attributed to the impact of a series of hurricanes. Employment in “food services and drinking places” was particularly hard-hit.

Having said that, this survey reports that “In September, average hourly earnings for all employees on private nonfarm payrolls rose by 12 cents to $26.55. Over the past 12 months, average hourly earnings have increased by 74 cents, or 2.9 percent.” That takes average weekly earnings to US$913.32, the highest average is in the mining industry at US$1,466.10 (+4.4%) and the lowest average in the “leisure and hospitality” industries at US$404.30/week (+3.2%). The lowest rises came for employees in the durable goods manufacturing industries which were up +1.8% to US$1,151.54/week.

The US unemployment rate was reported lower at 4.2%. (The New Zealand equivalent rate is 4.8%.)

Wall Street reacted to this data in a relatively muted way. It was influenced more by other data.

And analysts said they expected the US Fed to look past this employment weakness and push on with its interest rate rises this year.

The UST 10 year yield rise to 2.37%, up +2 bps on the day.

The US dollar rose on the news, pushing the New Zealand dollar down to 70.9 USc, its lowest level since May 30, 2017.

Meanwhile, CNN Money’s “Fear & Greed” indicator reached a record high on the “greed” index.