Not Great

The latest job creation stats are out, and it's kind of grim:

Hiring cooled in August, the latest in a long line of data released this summer that indicates President Trump’s trade war is starting to bite into an economy that could be on the verge of entering a rough patch.

The U.S. economy added 130,000 jobs in August, the Labor Department said Friday, below expectations of 160,000 job gains. The numbers were padded in part because the government hired a large number of temporary workers for the 2020 Census.

The hiring slowdown comes as broader economic growth has softened this year. The manufacturing sector is in a recession, and businesses have curtailed spending, largely as a result of headwinds from abroad and Trump’s trade policy whiplash.

This is a “murky” time for the economy with “significant risks,” Federal Reserve Chair Jerome H. Powell said Friday during remarks in Switzerland.

………

So far this year, job gains have averaged 143,000 a month, a noticeable downgrade from last year, when job gains averaged 192,000 a month, according to Lakshman Achuthan, co-founder of the Economic Cycle Research Institute.

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The job market still looks strong with more job openings than unemployed people. Wages grew at an annual pace of 3.2 percent in August, well above inflation and a slightly better-than-expected pace. The number of hours that U.S. employees are working also rose, typically a sign that companies are asking workers to stay later.

The U.S. economy has been growing for more than a decade now, and the gains appear to be reaching more people. The African American unemployment rate fell to an all-time low of 5.5 percent in August, and the labor force participation rate edged up to 63.2 percent, one of the highest rates in recent years as more people are finding jobs.

Note that this is still a lower labor force participation rate is still about 3% lower than before the great recession.

And while rising wages is a good thing, it should also be noted that job creation numbers were revised down for June and July.

A lot of the experts are putting these weak numbers to the trade war, but the Trump tax cuts have also contributing to an explosion of stock buybacks, as opposed to investments in new plant and equipment.