U.S. job creation accelerated in September, with the economy adding 248,000 new payroll jobs and the unemployment rate dropped below 6 percent to 5.9 percent.
Job gains in July and August were also revised up by a combined 69,000 in the Bureau of Labor Statistics’ official jobs report released Friday morning, alleviating fears that the labor market recovery had lost the momentum it had earlier in the year.
September’s job growth easily beat economists’ expectations for 215,000 new jobs. Over the past three months, payrolls have grown by an average of 224,000 a month. Over the course of 2014, the economy has added roughly 227,000 jobs each month, well above the averages for previous years of the recovery from the 2008 financial crisis.
After August’s weak report, September’s labor market news suggests that the economy has continued to slowly recover over the course of 2014. Over the past year, the unemployment rate has fallen by 1.3 percentage points. September’s 5.9 percent rate was the lowest since July of 2008.
Other details of Friday’s jobs report were mixed.
Although the improvement in the unemployment rate in recent months has been driven mostly by job gains, rather than by frustrated workers quitting the job search, labor force participation fell slightly in September. There were 97,000 fewer people in the labor force in September, according to the BLS’ household survey, and the the labor force participation rate ticked down to 62.7 percent, remaining near the lowest levels it has been since the late 1970s.
Long-term unemployment, which exploded to historical highs during the recession before and has receded in recent months, held steady at 3 million. Over the course of the past year, the number of people out of work for 27 weeks or longer has fallen by 1.2 million, and they now make up just 32 percent of all the jobless, down from 40 percent during the depths of the crisis.
Involuntary part-time unemployment also improved, but only slightly, in September. The number of people working part-time because they couldn’t find full-time work or because they had their hours cut was 7.1 million in the month, down by about 800,000 from a year ago.
The improvements around the edges of the labor market were reflected in the the U-6 unemployment rate, a broader measure of underemployment that incorporates the number of part-time workers and discouraged workers. The U-6 rate fell two tenths of a percentage point to 11.8 percent, down from 13.6 percent a year ago.
The jobs report contained no signs of wage acceleration, one key missing ingredient of the labor market recovery. Average hourly earnings fell by a cent to $24.53. Over the past 12 months, earnings are up 2 percent, just enough to keep pace with inflation. The average workweek, however, did tick up to 34.6 hours.
Many of September’s job gains occurred in low-paying sectors, including professional and business services and retail. Manufacturers added just 4,000 jobs. Construction, however, another one of the industries hardest hit by the housing bust and the recession, increased employment by 16,000 jobs. Over the past year, construction firms have grown their payrolls by 230,000.
This story was first published at 8:34 a.m. and has been updated.
