Payrolls rose less than projected in August and the unemployment rate declined as more Americans left the labor force, indicating the U.S. labor market is stagnating.
The economy added 96,000 workers last month following a revised 141,000 rise in July that was smaller than initially estimated, Labor Department figures showed today in Washington. The median estimate of 92 economists surveyed by Bloomberg called for a gain of 130,000. Unemployment unexpectedly fell to 8.1 percent, and hourly earnings were unchanged.
Employers may be reluctant to expand headcounts as they face a global economic slowdown and the so-called fiscal cliff of automatic tax increases and government spending cuts. The damage inflicted by the lack of progress on jobs is the reason Federal Reserve Chairman Ben S. Bernanke last week said the central bank may need to do more.
“Businesses are trying to plan for a climate of uncertainty,” Robert Dye, chief economist at Comerica Inc. in Dallas, said before the report. “There’s too much uncertainty about taxes, about expenditure cuts. The economy is already reacting to it.”
Stock-index futures pared gains after the figures, with the contract on the Standard & Poor’s 500 Index rising 0.2 percent to 1,434.4 at 8:35 a.m. in New York, after climbing as much as 0.5 percent.
Bloomberg survey estimates ranged from increases of 70,000 to 185,000. Revisions to prior reports subtracted a total of 41,000 jobs to payrolls in the previous two months.
Factory employment fell by the most in two years, temporary-help companies eliminated positions for the first time in five months and the share of the working-age population in the labor force slumped to the lowest since 1981.
Today’s figures come two months before the presidential election. Employment and the economy are central themes in the campaign, with President Barack Obama and Republican challenger Mitt Romney each trying to convince voters they can best energize the expansion and create jobs.
Private payrolls, which exclude government agencies, rose 103,000 after a revised gain of 162,000. They were projected to rise by 142,000, the survey showed.
The jobless rate fell from 8.3 percent as 368,000 Americans left the labor force. Unemployment was forecast to hold at 8.3 percent, according to the survey median. Estimates in the Bloomberg survey ranged from 8.1 percent to 8.4 percent.
Factory payrolls decreased by 15,000, compared with a survey forecast for a 10,000 increase, after a 23,000 gain in the previous month. Automakers cut 7,500 jobs last month.