State of the Labor Market

September Jobs Report: Hurricanes Kept Workers at Home, but Broader Unemployment Rate at Ten-Year Low


Hurricanes Harvey and Irma were all over today’s jobs report. The large drop in leisure and hospitality jobs pulled down the overall payroll numbers. Those industries tend to have lower wages, so the drop in low-wage employment boosted aggregate year-over-year wage growth. On the household side, nearly 3% of employed workers nationally said they were not working or working fewer hours due to bad weather — the highest recorded for a September.

Yet hidden behind the payroll decline were a new post-recession high in the prime-age employment rate and a decade-long low in the broader unemployment rate. That’s the clearest sign in the jobs report of continued economic recovery. Hurricanes Harvey and Irma blew this jobs report off course, but the strong household survey is reason enough to stay optimistic about the labor market’s direction.

The numbers show:

  • Excluding the most weather-sensitive sectors, September wasn’t even the worse month in 2017 for payrolls. That was March.

  • Nearly 3% of employed workers were working less or not at all due to weather last month.

  • Industries concentrated where Harvey/Irma hit grew more slowly than usual, but others industries slowed, too.


  • Leisure/hospitality took the big hit in payrolls in September.

  • Wage growth got a big boost from employment declines in low-wage industries–which is not something to cheer about.

  • The broader unemployment rate (U-6) hit its lowest rate in a decade, 8.3%.

  • Prime-age EPOP was up in September to 78.9%, the highest in years.

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