Businesses add fewest new jobs in 5 months
U.S. businesses added 154,000 jobs in September, the slowest pace of hiring since April, a private survey found.
Payroll processor ADP said Wednesday that manufacturers cut jobs for the eighth straight month and professional and business services, which includes high-paying jobs such as accountants and engineers, added the fewest jobs in five months.
The modest job gain adds to other recent evidence that hiring is slowing after several years of strong increases. Businesses added 175,000 jobs in August, ADP’s report said, and 196,000 in July.
Recent economic data has painted a mixed picture of the economy. Consumer spending slipped in August to its lowest level since March, yet consumer confidence has jumped to a nine-year high.
Trade deficit rises 3 percent in August
The U.S. trade deficit rose in August as a flood of imports offset the best showing for exports in 13 months. The politically sensitive deficit with China rose to the highest level in 11 months.
The trade deficit increased 3 percent to $40.7 billion, up from a gap of $39.5 billion in July, the Commerce Department reported Wednesday. Imports jumped 1.2 percent to $228.6 billion, reflecting big increases in shipments of foreign oil, autos and commercial aircraft. Exports were up 0.8 percent to $187.9 billion, the fourth straight monthly increase and the highest level in 13 months.
Analysts are hopeful that export sales will pick up after a rough two years when American producers had to battle a rising dollar that made their products costlier overseas.
“Exports are beginning to show signs of life as the drag from the dollar’s surge in 2014 and 2015 begins to fade,” said Paul Ashworth, chief U.S. economist at Capital Economics. He predicted that the rise in exports would contribute to overall growth in the July-September quarter.
The deficit with China increased 3.5 percent to $33.9 billion, the highest level since September 2015. So far this year, America’s deficit with China, the largest with any single country, is running 5.7 percent below last year’s level.
Service firm report fastest growth in a year
U.S. services companies grew last month at the fastest pace in nearly a year, potential good news for the U.S. economy.
The Institute for Supply Management says its services index jumped to 57.1 in September, the highest point since 58.3 last October. It was a big improvement on the August reading of 51.4, the lowest since February 2010.
New orders, production, export orders and employment grew faster last month.
Services firms have now grown for 80 straight months and have been a source of strength in an economy that has registered lackluster growth since late last year.
The ISM is a trade group of purchasing managers. Its services survey covers businesses that employ the vast majority of workers, including retail, health care and financial companies.