WASHINGTON — The nation's employers added 187,000 jobs in August, evidence of a slowing but still-resilient labor market despite the high interest rates the Federal Reserve has imposed.
Friday's report from the Labor Department showed that the unemployment rate rose from 3.5% to 3.8%, the highest level since February 2022 though still low by historical standards. But the rate rose for an encouraging reason: A sizable number of people — 736,000 — began looking for work last month, the most since January, and not all of them found jobs right away. Only people who are actively looking for a job are counted as unemployed.
The August jobs report also showed that wage gains are easing, a trend that may help signal to the Fed that inflation pressures are cooling: Average hourly wages rose 0.2% from July to August and are up 4.3% from August 2022. The year-over-year increase was down from 4.4% in both July and June. The Fed wants to see hiring slow because intense demand for labor tends to inflate wages and feed inflation. The central bank hopes to achieve a rare “soft landing,” in which its rate hikes would manage to slow hiring, borrowing and spending enough to curb high inflation without causing a deep recession.Optimism about a soft landing has been growing.