US job growth solid in August; labor market pressure starting to ease

Nonfarm payrolls increase 315,000 in August

Unemployment rate rises to 3.7% from 3.5% in July

Average hourly earnings gain 0.3%; up 5.2% year-on-year

Average workweek dips to 34.5 hours from 34.6 hours

WASHINGTON, Sept 2 (Reuters) — US employers hired more workers than expected in August, but moderate wage growth and a rise in the unemployment rate to 3.7% suggested the labor market was starting to loosen, raising cautious optimism that the Federal Reserve could slow the economy without triggering a recession.

The Labor Department’s closely watched employment report on Friday, which also showed 107,000 fewer jobs created in June and July than initially estimated, did not decisively settle the debate on whether the US central bank would deliver a third 75 basis point or half-a-percentage point rate hike at its policy meeting this month.

The increase in the unemployment rate to a six-month high came as nearly 800,000 people entered the labor market, driving the size of the labor force to a record high. The labor market remains strong, underscoring the economy’s resilience despite gross domestic product contracting in the first half of 2022.

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