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U.S Payrolls Rose Less Than Projected in September

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U.S payrolls rose less than projected in September, wages stagnated and the jobless rate was unchanged as people left the workforce, signaling the global slowdown and financial-market turmoil are rippling through the world’s largest economy.

The addition of 142,000 jobs followed a revised 136,000 gain the prior month that was lower than previously estimated, a Labor Department report showed Friday in Washington. The median forecast in a Bloomberg survey of 96 economists called for a 201,000 advance. The jobless rate held at 5.1 percent, and wage growth was unchanged.

The weak report vindicates the Federal Reserve’s decision to delay an interest-rate increase last month. Cooling overseas markets, a stronger dollar and lower oil prices that are hampering exports and manufacturing raise the risk that employers will hesitate before taking on more staff.

 A weaker-than-expected report “would chip away at confidence about the strength of the expansion,” Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, said before the report. “It may be a signal that there was a knee-jerk reaction by businesses to the market volatility.”

Employers added workers in industries including retailing, education, and leisure and hospitality.

Payroll estimates of 96 economists in the Bloomberg survey ranged from gains of 149,000 to 256,000 after a previously reported 173,000 advance for August.

The unemployment rate, which is derived from a separate Labor Department survey of households, was projected to hold at 5.1 percent, the lowest since 2008, according to the survey median.

 Revisions to prior reports cut a total of 59,000 jobs from payrolls in the previous two months.

Private employment, which excludes government agencies, rose by 118,000 after a 100,000 gain the prior month.

Government Hiring

Government payrolls rose by 24,000. Employment at state and local agencies is often influenced at this time of the year by swings in the education sector related to the timing of the school year.

There may be some payback after the surge in local government education payrolls in recent months, Ted Wieseman, an economist at Morgan Stanley, said in a note before the report.

Factory payrolls fell by 9,000. Manufacturing and mining have been hurt by cutbacks in drilling and exploration following the plunge in oil and commodities prices. Exports also are weakening amid a China-led slowdown in global growth.

Retailers increased payrolls by 23,700. Employment in leisure and hospitality rose 35,000.

The participation rate, which indicates the share of the working-age people in the labor force, decreased to 62.4 percent from 62.6 percent. That was the lowest since October 1977.

The average work week for all workers fell to 34.5 hours from 34.6 hours.

Average hourly earnings were unchanged from the month before, the report showed. They increased 2.2 percent over the 12 months ended in September, the same year-over-year change as in August. They’ve posted a 2 percent gain on average since the current expansion began in mid-2009.

Among the few positive signs in the report was a figure showing more full-time job opportunities. Americans working part time who would prefer a full-time position decreased to 6.04 million, the fewest since August 2008, from 6.48 million.

Underemployment

The underemployment rate — which includes part-time workers who’d prefer a full-time position and people who want to work but have given up looking — dropped to 10 percent, the lowest since May 2008, from 10.3 percent.

The gap between the unemployment rate and the underemployment rate is one reason Fed Chair Janet Yellen and other policy makers have said they’ll increase interest rates only gradually.

In a speech last week Yellen said there are still people seeking full-time work who could be pulled back into the labor force if the jobless level fell further. She noted that “may involve a temporary decline in the unemployment rate somewhat below the level that is estimated to be consistent, in the longer run, with inflation stabilizing at 2 percent.”

In their meeting last month, policy makers projected this long-term rate was 4.9 percent, according to officials’ median forecast.

Central bankers delayed raising their benchmark interest rate in September. It’s been near zero since December 2008. Officials next meet on Oct. 27-28, and Yellen has been among those saying an increase this year remains on track.

 

Source: Bloomberg

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Economy

Tinubu Forms Economic Advisory Committee with Private Sector Titans

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Bola Tinubu

In a bid to address Nigeria’s economic challenges amidst soaring inflation and currency depreciation, President Bola Tinubu has announced the formation of an Economic Advisory Committee with influential figures from the private sector.

The decision follows a high-level meeting held at the State House in Abuja, where key stakeholders deliberated on strategies to stabilize the economy and mitigate the rising cost of living.

Among the notable members enlisted to the committee are Tony Elumelu, Chairman of United Bank for Africa, and Aliko Dangote, Chairman of Dangote Group, both distinguished figures in Nigeria’s business landscape.

The inclusion of these private sector titans underscores Tinubu’s commitment to engaging diverse perspectives and expertise in charting a path towards economic recovery.

Speaking on behalf of the federal government at the meeting, President Tinubu emphasized the imperative of collective efforts in revitalizing the economy and ensuring a brighter future for all Nigerians.

He underscored the importance of addressing pressing issues such as food security, job creation, and the stabilization of the exchange rate.

In response, Aliko Dangote expressed optimism about the committee’s potential to generate actionable recommendations that would foster economic growth and alleviate poverty across the nation.

Similarly, Tony Elumelu highlighted the significance of implementing effective policies to drive employment opportunities and enhance food security.

The committee’s mandate encompasses a broad spectrum of economic concerns, including currency stability, inflation management, and fiscal policy reforms.

As Nigeria grapples with the multifaceted challenges of a turbulent economy, the collaborative efforts of government and private sector stakeholders signal a proactive approach towards finding sustainable solutions and restoring confidence in the nation’s economic prospects.

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Federal Government Halts Cooking Gas Export to Lower Local Prices

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cooking gas cylinder

In a bid to stabilize domestic prices and meet rising demand for cooking gas within Nigeria, the Federal Government has announced a temporary halt on the exportation of Liquefied Petroleum Gas (LPG), commonly known as cooking gas.

This decision follows a significant surge in the cost of cooking gas, which has placed a strain on consumers across the country.

According to reports, the halt in LPG export aims to increase the availability of the commodity within Nigeria’s borders, thereby reducing its local price.

The move is part of broader efforts to address the challenges faced by consumers grappling with the high cost of living.

In recent years, the demand for cooking gas has steadily increased in Nigeria, driven by urbanization, population growth, and a shift towards cleaner energy sources.

However, despite being a major producer of LPG, Nigeria has struggled to meet its domestic demand due to insufficient local production and distribution infrastructure.

Data from the Nigerian Midstream Downstream Petroleum Regulatory Authority reveals that while the total consumption of cooking gas in Nigeria has been on the rise, the country has relied heavily on imports to bridge the supply gap.

The recent decision by the government underscores its commitment to prioritizing the domestic market and ensuring that Nigerians have access to affordable cooking gas.

Consumers have been grappling with escalating prices, with reports indicating a significant increase in the cost of refilling a 12.5kg cylinder of cooking gas in major cities like Abuja, Lagos, and Kano.

The decision to halt LPG exports signals a proactive measure by the government to mitigate the adverse effects of rising prices and alleviate the financial burden on households across the nation.

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Manufacturing Sector Records 7.70% Quarter-on-Quarter Growth in Q4 2023

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In the fourth quarter of 2023, Nigeria’s manufacturing sector grew by 7.70% year-on-year, according to the National Bureau of Statistics (NBS).

The surge in growth reflects a significant uptick from the preceding quarter and underscores the resilience of the manufacturing industry amid economic challenges.

This growth trajectory indicates positive momentum and signals potential opportunities for economic recovery and development.

The manufacturing sector, comprising thirteen key activities ranging from oil refining to motor vehicles and assembly, demonstrated notable dynamism across various subsectors.

This growth surge is attributed to increased production, enhanced operational efficiencies, and strategic investments across the manufacturing value chain.

Despite facing headwinds such as supply chain disruptions and regulatory uncertainties, the sector’s robust performance underscores its pivotal role in driving economic diversification, job creation, and industrialization efforts in Nigeria.

Moving forward, sustaining this growth momentum will require continued policy support, investment in infrastructure, and efforts to address key bottlenecks hindering the sector’s expansion.

By fostering an enabling business environment and promoting innovation and technology adoption, Nigeria’s manufacturing sector can further catalyze inclusive economic growth and contribute significantly to the nation’s development agenda.

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