WASHINGTON - Payrolls in the U.S. climbed less than projected in August after smaller gains the prior two months, indicating companies are being deliberate in their hiring as they wait for a pickup in demand. The unemployment rate unexpectedly fell as more people left the labor force.
The gain of 169,000 workers last month followed a revised 104,000 rise in July that was smaller than initially estimated, Labor Department figures showed today in Washington. The median forecast of 96 economists surveyed by Bloomberg called for an August increase of 180,000. Unemployment dropped to 7.3 percent, the lowest since December 2008.
The weaker data come as Federal Reserve officials, who meet Sept. 17-18, are debating whether the expansion and job market have improved enough to warrant trimming monthly bond purchases. While some companies are awaiting a pickup in sales before adding to staff, Ford Motor Co. is among those putting more workers on assembly lines as the auto industry surges.
“Job growth will remain less than desirable until we see the pace of economic activity pick up,” Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit, said before the report. “In this environment, businesses have to tread their way gingerly.”
The unemployment rate, derived from a Labor Department survey of households rather than employers, was forecast to hold at 7.4 percent, according to the Bloomberg survey median.
The participation rate, which indicates the share of working-age people in the labor force, declined to 63.2 percent, the lowest since August 1978, from 63.4 percent.
Bloomberg survey estimates for payrolls ranged from increases of 79,000 to 220,000 after a previously reported 162,000 gain in July. Revisions to prior reports subtracted a total of 74,000 jobs to overall payrolls in the previous two months.
Private employment, which exclude government agencies, rose 152,000 after a revised gain of 127,000 in July that was weaker than first reported. Private payrolls were projected to rise by 180,000, the survey showed.
Employment at factories increased by 14,000 following a 16,000 decrease in the previous month. Economists had projected a 5,000 rise.
Employment at private service-providers increased less in August than the prior month. Government payrolls rose by 17,000.