In the first drop since 2003, the US lost 4,000 jobs in August, surprising experts and putting more pressure on the Fed to reduce rates at its upcoming meeting. Economists had predicted an increase of 100,000 or more jobs. The decline in employment is the clearest signal to date that the housing recession and credit crunch are hurting the broader economy, Bloomberg reports.
Manufacturers, builders and the government account for much of the cuts. Factories lost 46,000 jobs, outpacing predictions of a 10,000 falloff. Meanwhile, a revision to June and July’s payrolls numbers lowered those months’ gains by 81,000 workers. The unemployment rate held steady at 4.6%.