As the summer of 2023 came to a close and the labor market slowed, the unemployment rate in the United States rose dramatically in August.
According to Bureau of Labor Statistics data issued today, unemployment was 3.8 percent, a considerable increase from July and the highest level since February of last year.
Non-fund payroll estimates for preceding months revealed a strong downward revision, with the labor force participation rate rising to 62.8 percent, the highest since February 2020, shortly before the covid declaration.
However non-fund payroll grew by seasonal adjusted 187,000 for the month.
The uptick in job gains came as employment figures for June and July were both revised downwards, and the figures overall signal a steady pace of hiring while the labor market shows signs of cooling.
Policymakers have been struggling to cool the economy and rein in stubborn inflation, with the Federal Reserve lifting interest rates rapidly — recently bringing them to the highest level in over two decades.
But the central bank has also vowed to be data-dependent in its upcoming decisions.
Meanwhile, a relatively strong labor market has added to hopes that the United States can bring inflation down without tipping the economy into a recession.
On Friday, Labor Department data showed that average hourly earnings in August rose 0.2 percent, slower than the month before.
“Employment continued to trend up in health care, leisure and hospitality, social assistance, and construction,” the department said.
Employment in transportation and warehousing fell.