US Employment Situation Report - FX Solutions Market Update, 11th October 2011

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Date: Thu, 20 Oct 2011 Time: 2:48 PM
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Joseph Trevisani, Chief Market Analyst at FX Solutions (http://www.fxsolutions.com/), provides forex traders with an overview of currency market activity and news on 10th Octover 2011.

American firms hired more employees in September than forecast easing fears that slow economic growth was dipping into recession.

Nonfarm payrolls rose by 103,000 topping the 60,000 median estimates from the Bloomberg survey and, combined with an upward revision of 99,000 to the August and July numbers the report gave a picture of a stronger economy headed into the fourth quarter.

The August and September numbers had been skewed by 45,000 Verizon workers who went out on strike in August, subtracting from payrolls and returned to work in September, adding to the rolls.

The unemployment rate remained at 9.1% for the third month in a row. The rate has been at 9.0% or higher for 29 months, since May 2009. The so-called underemployment rate, officially the U-6 rate from the Bureau of Labor Statistics, which includes workers who want to work but have stopped looking for a job and those who are employed part time because they cannot find full time labor in addition to the unemployed counted in the standard rate, rose to 16.5% from 16.2%, the highest since last December.

Private payrolls gained 137,000 workers well more than the 90,000 predicted. Government at all levels shed 34,000 workers, as did manufacturing which dropped 13,000 jobs, the biggest decline since last August. The construction trades added 26,000 jobs the largest gain since February, led by commercial construction.

Average hourly earnings added 0.2% as forecast; the August reading was revised down to -0.2% from -0.1%. Over the year since last September earnings have risen 1.9%, a bit less than the August 2.0% core CPI rate in August but only half the 3.8% headline rate that consumers actually pay in the store. The average work week gained 0.1 hour to 34.3. Hours have varied little in the past 21 months, moving between 34.0 and 34.4. The historical average for this series, which only goes back to April 2006, is 34.3

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