158,936,000: Record Number of Employed, But Labor Force Participation Drops 0.1%

Susan Jones | October 7, 2022 | 6:08am EDT
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President Joe Biden looks at quantum computer during a tour of the IBM facility in Poughkeepsie, New York, on October 6, 2022. IBM has announced a $20-billion investment in quantum computing and semiconductor manufacturing at its New York state facilities. (Photo by MANDEL NGAN/AFP via Getty Images)
President Joe Biden looks at quantum computer during a tour of the IBM facility in Poughkeepsie, New York, on October 6, 2022. IBM has announced a $20-billion investment in quantum computing and semiconductor manufacturing at its New York state facilities. (Photo by MANDEL NGAN/AFP via Getty Images)

(CNSNews.com) - Federal Reserve Chairman Jerome Powell warned last month that raising interest rates to cool inflation is likely to dampen economic growth -- "and there will very likely be some softening of labor market conditions," he said.

But there's no significant softening evident in Friday's jobs/employment report.

On Friday, the Labor Department's Bureau of Labor Statistics reported that the number of employed Americans in September rose by 204,000 to 158,936,000, a record high. The previous record, 158,735,000, was set in December 2019 when Donald Trump was president.

But another key indicator of economic health -- the labor force participation rate -- dropped a tenth of a point to 62.3 percent from 62.4 percent in August.

This number reflects the active workforce -- the percentage of civilian, non-institutionalized workers available for the production of goods and services, so the higher, the better.

In September, the civilian non-institutional population in the United States was 264,356,000. That included all people 16 and older who did not live in an institution, such as a prison, nursing home or long-term care facility.

Of that civilian non-institutional population, 164,689,000 were participating in the labor force, meaning they were either employed or unemployed -- they either had a job or were actively seeking one during the last month. This resulted in a labor force participation rate of 62.3 percent in September, down from 62.4 percent in August (which was a 0.3 percent increase from July).

The participation rate was 61.4 percent when Joe Biden took office as the pandemic raged. Today's number, 62.3 percent, is still below the Trump-era high of 63.4 percent recorded in February 2020, just before COVID shut things down.

After rising for more than three decades, the overall labor force participation rate peaked in early 2000 at 67.3 percent and subsequently trended down. In recent years, baby-boom retirements have contributed to the decline in the overall participation rate.

BLS also reported on Friday that the nonfarm economy added 263,000 jobs, better than the estimate of around 250,000. Notable job gains occurred in leisure and hospitality and in health care.

The unemployment rate dropped to 3.5 percent in September from 3.7 percent in August. This number reflects the number of unemployed people (5,753,000 in September) as a percentage of the labor force, which is the sum of the employed and unemployed (164,689,000 in September).

In September, the number of employed Americans increased by 204,000, as noted above, while the number of unemployed dropped by an even larger 279,000, and that's what pushed the unemployment rate down.

Last month's 3.5 percent unemployment rate matches the Trump-era low set in January/February 2020, just before COVID hit full-force.

The number of Americans not in the labor force -- no job and not looking for one -- increased by 229,000 to 99,667,000 in September, still much higher than the 95,000,000 levels recorded before COVID impacted employment. This group includes a growing number of baby boom retirees.

Among the major worker groups, the unemployment rate for Hispanics decreased to 3.8 percent in September. The jobless rates for adult men (3.3 percent), adult women (3.1 percent), teenagers (11.4 percent), Whites (3.1 percent), Blacks (5.8 percent), and Asians (2.5 percent) showed little change over the month.

In September, average hourly earnings for all employees on private nonfarm payrolls rose by 10 cents, or 0.3 percent, to $32.46.

The change in total nonfarm payroll employment for July was revised up by 11,000, from +526,000 to +537,000, and the change for August remained at +315,000. After revision, employment gains in July and August combined were 11,000 higher than previously reported.

In September, 5.2 percent of employed persons teleworked because of the coronavirus pandemic, down from 6.5 percent in the prior month. In May 2020, the first month these data were collected, 35.4 percent of employed persons teleworked because of the coronavirus pandemic.

The business and economic reporting of CNSNews.com is funded in part with a gift made in memory of Dr. Keith C. Wold.

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