U.S. Job Market Stalls: August Sees Only 54K Jobs Added

The U.S. labor market showed signs of significant slowdown in August, with only 54,000 jobs added, according to the latest report from ADP. This stark figure reflects a broader trend of declining hiring plans, which have reached record lows as initial jobless claims rose to 237,000, the highest level since June.

The four-week moving average for jobless claims increased to 231,000, while continuing claims remained at 1.94 million, keeping the insured unemployment rate steady at 1.3%. Although not classified as a crisis, these numbers indicate that displaced workers are struggling to secure new employment, potentially turning a slowdown into a more serious economic issue.

Data from the Job Openings and Labor Turnover Survey (JOLTS) further compounds the concern, revealing fewer job openings and a historic shift where unemployed workers now outnumber available positions for the first time since 2021. The quit rate has also declined, signaling waning confidence among workers regarding better job opportunities.

Looking ahead, Goldman Sachs has projected that a forthcoming annual benchmark revision to Nonfarm Payrolls could adjust last year’s job totals downward by as much as 950,000. This follows last August"s significant revision, which erased 818,000 jobs from the record, triggering a notable reaction from the Federal Reserve. A similar adjustment now could set the stage for a potential 50 basis point rate cut.