The unemployment rate in the United States fell to 3.7 percent in September, which happens to be the lowest since 1969. On Friday, the Labour Department reported that the rate came down from 3.9 percent in the previous month as employers went on to add 134,000 jobs. It had an extended period with an 8.5-year streak of monthly job growth, the longest on record. This low rate of unemployment is the best in almost 49 years and reflects a healthy economy, mainly driven by a strong consumer and business spending. In reality, hiring is so strong that employers are having problems to fill up the openings. Some are even forced to offer higher salaries.
In the year 1969, strong economic growth was supported by large-scale government spending on the Vietnam War and freshly created Great Society social programs. Moreover, women were likely to work. While reporting the employment figures for September, the US Government quite sharply revised the upward estimates for hiring back in July and August. Till now this year, the monthly growth of job has seen an average of 208,000 compared to 182,000 last year. Chief Economist at Amherst Pierpont Securities, Stephen Stanley termed the acceleration in job gains in 2018 to be extraordinary.
Most of the analysts blamed the slow pace of hiring last month on Florence, which struck North and South Carolina, hence closing down thousands of businesses. Friday’s reports would most probably keep the Federal Reserve right on track to raise short-term interest rates with another increase expected to come up in December. There are certain weak spots in the economy. For instance, sales of existing homes have seen a sharp fall over the previous year. They have been mostly held back in part due to high rates of the mortgage. Similarly, sales of cars have also gone down. According to the Chief Economist at Moody’s Analytics, Mark Zandi said that if the tariffs remain totally in effect even for a year from now, there could be a loss of 300,000 till that point.
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