The Labor Department reported that nonfarm payrolls declined by 54,000 in August and the unemployment rate rose to 9.6 percent. The overall decline was driven by the departure of 114,000 temporary 2010 Census workers and private sector payrolls rose by 67,000.
The increase in private payrolls was more than the consensus estimate of 40,000 and, coming after an upwardly revised gain of 107,000 in July, eased some fears that higher jobless claims might lead to renewed job losses for U.S. companies.
The unemployment rate ticked one-tenth of a percentage point higher due to more workers entering the labor force and the broad measure of U6 underemployment – including those accepting part-time work instead of full-time work and those who have stopped looking for work – rose from 16.5 percent to 16.7 percent.
By category, it was a familiar story in August as the health care industry continues to be a steady source of job growth with a net gain of more than 40,000 jobs and temporary hiring (within the Professional and Business Services category below) bounced back from a modest decline in July with a gain of 16,800.
At odds with the latest manufacturing surveys where employment was seen expanding, the Labor Department reported that manufacturing payrolls were lower by 27,000, the third decline in the last four months.
The biggest losses, however, came from the government sector, all but 7,000 of the net payrolls decline of 121,000 coming from laid off Census workers. State governments saw payrolls decline by 14,000, but local governments added 4,000 jobs.
