By Isaac Cohen*
Despite the creation of 151,000 new jobs in August, under this year’s monthly average of 182,000, the latest figure confirms the strong performance in the labor market, while the US economic expansion continues at a moderate pace. The unemployment rate remained unchanged in August, at 4.9 percent, with inflation still below the 2 percent objective. The last meeting of the central bank’s Open Market Committee also recognized that “near-term risks to the economic outlook have diminished.”
In August, hourly wages increased 2.4 percent from a year earlier, slightly less than the 2.6 increase of last July. Additionally, according to research from The Federal Reserve Bank of New York, jobs earning middle income wages have outpaced the creation of jobs earning high and low income wages. Between 2013 and 2015, 2.3 million jobs earning between $30,000 and $60,000 were created, amounting to 50 percent more than in the low and high wage categories.
If the vigorous pace of job creation of June and July, at 292,000 and 255,000 respectively, had continued in August, there was almost unanimous agreement that an interest rate increase would be approved by the next Federal Open Market Committee meeting, of September 20-21. If that is not the case, there are still two more meetings scheduled for this year, on November 1-2, which is too close to the November 8 elections and the last one on December 13-14.
*International analyst and consultant. Commentator on economic and financial issues for CNN en Español TV and radio. Former Director, UNECLAC.