US nonfarm payrolls rose just 29,000 in September. RSM US says population ageing
and tighter immigration policy have sharply slowed labor-supply growth, making
roughly 50k monthly job gains a possible new normal over the next two years and
arguing weak payrolls need not imply a deteriorating labor market; it expects
the Fed to pause in October. ING says payrolls, unemployment and wage growth all
undershot in September and slower wage growth reduces labor-cost inflationary
pressure, lowering the need for an October hike and making December the
likeliest next move. ABN AMRO Bank notes that 29k jobs, given slower
labor-supply growth, is consistent with a still-stable jobs market and easing
wage pressures, giving the Fed room to wait for more data. Another report
highlights a slowdown in hiring with limited layoffs so far, keeping the
unemployment rate stable but warning that a rise in layoffs would increase
downside risk. BofA client-account data show further slowing in wage-income
growth in September but fewer unemployment-benefit claims and after-tax wages
for low-income households up 4.5% YoY, pointing to pockets of resilience. KPMG
says the Fed still has reason to prioritise fighting inflation but should avoid
inducing unnecessary economic slowdown; September hikes bought time to observe
labor and inflation trends, and a pause in October would be risk management
rather than abandonment of tightening.
