US Revises Job Growth Down for July and August

The US Bureau of Labor Statistics revised its job growth estimates for July and August downward by a total of 60,000 on October 2. Initially, July was reported to have added 21,000 jobs, but the revision showed a loss of 10,000. August's job gains were adjusted from 162,000 to 133,000. The September employment report indicated payroll growth of 29,000, which did not reflect new job losses but rather adjustments to earlier estimates.

Average hourly earnings for private nonfarm payrolls rose 0.1% monthly and 3.0% annually, down from the previously reported 0.3% monthly and 3.1% annual increases for August. The Federal Reserve, which raised interest rates to a target range of 3.75% to 4% on September 16, noted that job gains had kept pace with workforce growth but also highlighted elevated inflation. The revised data presents a softer payroll picture, potentially reducing the need for further tightening to restrain labor demand.

However, inflation remains a concern, with August's personal consumption expenditures inflation running at 3.4% annually and 3.0% annually excluding food and energy, both above the Fed's 2% goal. While weaker hiring and slower wage growth may ease pressure on speculative assets like Bitcoin, the Fed's focus on inflation could still lead to further tightening. A study by the New York Fed in February 2023 found that Bitcoin was largely unresponsive to monetary and macroeconomic surprises.

The household survey showed employment rising by 406,000, with labor force participation increasing from 61.6% to 61.8%. Unemployment edged up from 4.1% to 4.2%. The mixed data complicates the interpretation of the employment report, neither confirming a recession nor a decisive rebound. The next jobs report is scheduled for November 6.