US unemployment rate falls to 50-year low of 3.5%
The US unemployment rate has fallen to a 50-year low, possibly easing recession worries after recent weak economic data.
The Labor Department figures showed that the rate fell to 3.5% in September from 3.7%, with the economy adding 136,000 jobs last month.
In addition, August data was revised up to 168,000 jobs created instead of the previously reported 130,000.
However, wage growth was unchanged and manufacturing jobs fell in September.
The report came on the heels of a string of weak economic reports, including a plunge in manufacturing activity to more than a 10-year low in September and a sharp slowdown in services industry growth to levels last seen in 2016.
There are fears that the Trump administration’s 15-month trade war with China is spilling over to the broader economy. The US-China trade dispute has eroded business confidence, hitting investment and manufacturing.
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Despite the continued moderate employment growth and sharp drop in the jobless rate, many economists still expect the Federal Reserve to cut interest rates at least one more time this year.
The US central bank cut rates in July for the first time since 2008 and cut them again last month. It is trying to keep the longest economic expansion in US history, now in its 11th year, on track.
September’s job gains were below the monthly average of 161,000 this year, but still above the roughly 100,000 needed each month to keep up with growth in the working-age population, according to economists.
Manufacturing shed 2,000 jobs last month, the first decline since March, after hiring 2,000 workers in August. The sector is seen as having borne the brunt of the trade wars.
This week, Washington announced tariffs on aircraft, other industrial products and agricultural products from the European Union as part of a dispute over aircraft subsidies given to Boeing’s rival Airbus.