BACK TO WORK: Unemployment Drops to 3.7%, Lowest Since DECEMBER 1969

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BACK TO WORK: Unemployment Drops to 3.7%, Lowest Since DECEMBER 1969

I expect the unemployment rate to hold at 3.9 percent.

At some point, analysts and observers are going to have to get comfortable with the notion that a jobs report can simultaneously be "good" and not show payroll growth in the vicinity of 200,000. This suggests that the tax cuts that took effect this year are boosting job opportunities.

The historically low USA unemployment rate fell again during the month of September, but about 50,000 fewer jobs were added to the economy than experts predicted. Hurricane Florence probably dented hiring in some sectors as well, which should reverse in the coming months. Average hourly employee earnings rose by $0.08 or 0.3% to $27.24 in September, reflecting a year-over-year increase of 2.8%. The jobless rate's decline to a 48-year low will put that view to the test.

And many analysts see the unemployment rate continuing to decline this year, ramping up pressure on wages and prices.

"If the labor market were as tight as implied by the Fed's estimate of full employment, job growth this strong would likely place significant upward pressure on wages", Mickey Levy, chief USA and Asia economist at Berenberg Capital Markets in NY, said in a note. Teen unemployment fell by 0.3 percent to 12.8 percent.

Economy adds 134K jobs in September. After upward revisions to previous months' numbers, job gains have averaged 190,000 per month over the past three months, more than enough to keep unemployment on a downward trend. With the bigger than expected decrease, the unemployment rate fell to its lowest level since hitting 3.5% in December of 1969. Job gains occurred in professional and business services, in health care, and in transportation and warehousing.

A cornerstone of Trump's economic policy is strengthening automobile manufacturing in the United States. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.

Some measures showed the labor market may still have some room for further improvement.

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