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yesterday

Labor Market Gloom Deepens as Record-Low Job Prospects Fuel Bets on September Fed Cut

The jobless rate rose to 4.3% on a jump in labor-force participation, with inflation expectations little changed.

Job seekers attend a Diversity Career Group job fair in Los Angeles, California, on Thursday, April 17, 2025.
U.S. job growth this year has been dependent on the healthcare and hospitality sectors.
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Overview

  • U.S. nonfarm payrolls rose by just 22,000 in August as the unemployment rate ticked up to 4.3% following an estimated 436,000 increase in the labor force.
  • June employment was revised to a loss of 13,000 jobs, reinforcing a multi-month slowdown that has left hiring well below earlier estimates.
  • New York Fed survey respondents put the probability of finding a new job at 44.9%, the lowest since the series began in 2013, with higher expectations for job loss and unemployment.
  • Futures pricing via CME FedWatch now implies a quarter-point cut on Sept. 16–17 with a small chance of a 50-basis-point move, aligning with Fed Governor Christopher Waller’s stated support for easing.
  • Year-ahead inflation expectations edged to 3.2% in the NY Fed survey as Wall Street forecasts August CPI at about 2.9% year over year and core near 3.1%, with tariffs cited as an upside risk.