The US jobs market stalled in September, losing 33,000 jobs, as Hurricanes Harvey and Irma took their toll. It was the first time in seven years that the US monthly total had recorded a fall.
The US economy had added an average of 176,000 new jobs a month so far this year but as the labor department had predicted the storms, which caused fatal and catastrophic damage across Texas and Florida, slowed hiring.
But a loss in jobs was far worse than the 80,000 new jobs most US economists had expected would be created. It ends the longest stretch of uninterrupted jobs growth in US history. This was the first loss in jobs since September 2010.
Ahead of Friday’s jobs report the Bureau of Labor Statistics said some 11.2 million workers lived in the affected areas, about 7.7% of the US workforce.
Employment in food services and drinking places declined by 105,000 in September. That sector has added an average of 24,000 jobs a month over the past 12 months.
The unemployment rate, which was 4.4% in August, fell to 4.2%, a 16-year low.
This is the second month of disappointing growth in the US jobs market. In August the economy added 156,000 new jobs, below the 180,000 that had been expected by economists.
August’s jobs report was revised up from 156,000 to 169,000 but July’s was revised down to 138,000 from 189,000, a net loss of 38,000 for the two months.
The disappointing jobs figures could continue. After Hurricane Katrina in September 2005, the US reported a 35,000 decline in jobs, well below the three-month average of 175,000 in job gains. It took two payroll reports for the jobs market to recover.
On Wednesday ADP, the payrolls processor, said the private sector had added 135,000 jobs in September, sharply down from the 228,000 added in August.
“Hurricanes Harvey and Irma hurt the job market in September,” said Mark Zandi, chief economist at Moody’s, which helps compile the ADP report. But he added that: “Looking through the storms the job market remains sturdy and strong.”
Paul Ashworth, chief US economist at Capital Economics, said: “If past storms, particularly Katrina, are any guide, employment will rebound markedly over the next few months. The drop in the unemployment rate might persist, however, with consumer and small business surveys both pointing to a drop in the unemployment rate to nearer 4% for some time.”
Puerto Rico, the US territory also devastated by the hurricanes, is not counted in the jobs report.
