Comment on U.S. Bureau of Labor Statistics Employment Situation Report: Kathy Bostjancic, Director of Macroeconomic Analysis, The Conference Board

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Sep 06, 2013, 09:30 ET

NEW YORK, Sept. 6, 2013 /PRNewswire/ --

Job Growth Remains Subpar
After sustaining gains just under 200,000 per month during the spring, the disappointingly weak gain of 169,000 in August leaves the July-August average advance at just 137,000. The unemployment rate dropped again in the month to 7.3 percent, but for all the wrong reasons as the labor participation rate fell to a disappointingly low 63.2 percent. Despite better GDP estimates showing a 2.5 percent annual rate in the second quarter, slower growth in July and August continues to put a damper on job growth going forward. Consumer demand remains constrained by household caution and anemic income growth, business investment remains largely on hold, and the Federal Government continues to operate under sequestration. In addition, with inflation very low, business is attempting to limit increases in labor costs. In short, demand isn't there and money to pay additional workers isn't there. The lackluster labor market might lead the Federal Reserve to delay the tapering of its quantitative easing.

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