Despite a further decline in the unemployment rate, taking it to a five-year low of 7.2%, economists said they were disappointed by the 148,000 increase in non-farm payrolls during September.
Capital Economics’ Paul Ashworth, the consultancy’s chief US economist, said that the data for September would reinforce expectations that tapering would be postponed until early 2014.
“The unemployment rate keeps edging lower, but the Fed seems to be more focused on the drop-off in the pace of monthly payroll gains,” Ashworth said, adding that the average six-month labour gains looked virtually unchanged at 163,000, and were still some way off the pace of around 200,000 recorded in spring.
“Given the government shutdown, October’s payrolls are likely to be weak too,” he added.
“That means unless November’s gain turns out to be over 250,000, it now looks like the Fed could delay tapering until early next year.”
Markit Economics was also downbeat and said the numbers achieved were below the 180,000 expected.
Despite this, the jobs created pushed the US unemployment rate to its lowest level since November 2008, and nudged it down from August’s 7.3% level.
Like Capital, Markit had concerns about the slowdown in the rate of jobs added to the economy and said the 16-day shutdown while Congress argued over the debt ceiling was a source of further uncertainty.
Markit’s Chris Williamson, chief economist, explained: “The Fed was already keen to await more data on the health of the economy before it makes any decisions on policy, but now also needs to gauge the impact the shutdown itself has had on the economy.
“It would be surprising to see any tapering from the Fed until the new year, and possibly as late as March.”
