Huo Xing Finance reports that on September 5, analysts noted that U.S. non-farm payroll employment increased by 162,000 in August, significantly exceeding the market expectation of 56,000, with prior months’ figures revised upward by a total of 55,000—July’s non-farm payrolls were revised from a decline of 23,000 to an increase of 21,000. However, after excluding one-time factors such as rebounding employment in leisure and hospitality and government education sectors, underlying job growth in August was approximately 60,000, indicating that the overall labor market is not as robust as the headline data suggests. The report highlighted that the unemployment rate remained steady at 4.1%, the labor force participation rate rose to 61.6%, and the broader U-6 unemployment rate declined from 7.9% to 7.7%, showing that increased labor supply is still being absorbed by employer demand, improving labor market quality. However, average hourly earnings growth slowed further to 3.1% year-over-year from 3.2%, below the July CPI growth rate of 3.4%, suggesting the labor market is not overheating again. Regarding Federal Reserve policy, Guangfa Macro believes the August non-farm data refutes both extreme narratives of a “job collapse” and a “job resurgence,” but objectively increases the probability of an interest rate hike this year, as labor market resilience reduces concerns about further policy tightening. Nevertheless, whether a rate hike occurs in September will depend primarily on the upcoming August inflation data. In markets, after the data release, FedWatch implied the probability of a September rate hike rose from 50% to 58.6%. The 2-year and 10-year U.S. Treasury yields increased by 4 and 1 basis points respectively to 4.37% and 4.78%. U.S. equity indices edged lower, but the AI hardware sector reversed course, with the Philadelphia Semiconductor ETF (SOXX) rising 3%.
U.S. August Nonfarm Payrolls Show Strong Surface Growth, Intrinsic Job Growth at ~60K
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Summary
U.S. August nonfarm payrolls rose by 162,000, significantly exceeding the forecast of 56,000, with July’s figure revised up to 21,000. Excluding one-time factors such as leisure and education jobs, underlying growth was approximately 60,000. The unemployment rate remained steady at 4.1%, while the CFT-compliant labor force participation rate increased to 61.6%. Hourly wage growth slowed to 3.1%, below July’s 3.4%. Bitcoin as a hedge against inflation remains under scrutiny, as the Fed’s September decision depends on inflation data. The implied probability of a rate hike rose to 58.6%. Treasury yields and the SOXX ETF also advanced.
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