Another sluggish report: employment rose by 22,000 or 0.1 percent in August from July to barely top Econoday's consensus for a 15,000 gain. The unemployment rate rose to a nasty 6.6 percent in August from 6.4 percent in July. Forecasters looked for unemployment to rise to 6.5 percent in August. On a year-over-year basis, the unemployment rate was up by 1.1 percentage points in August.

The jobless rate in August was the highest since May 2017, outside of 2020 and 2021, during the pandemic.

The participation rate edged up to 65.1 percent from 65.0 percent in July and versus 65.3 percent in June. The July participation rate was the lowest since June 1998, excluding the pandemic period.

Total hours worked were pretty flat in August, down 0.1 percent and up a modest 1.4 percent from a year ago. Average hourly wages continued to cool at a 5.0 percent year-over-year rise after 5.2 percent in July and 5.4 percent in June.

August was the fourth straight month of relatively flat employment. For August, this reflected an increase of 66,000 in part-time work, mostly offset by a decline of 44,000 in full-time work.

Private sector jobs rose by 38,000 in August after falling 42,000 in July. The increase in private employment in August was the first since April. Public sector employment and self-employment were both nearly flat in August.

By sector, employment in educational services rose by 27,000, health care and social assistance gained 25,000 and finance was up 11,000. On the downside,"other services" fell 19,000, professional services fell 16,000 and utilities lost 6,800 jobs.

Employment in August is expected to rise 15,000 versus small disappointing declines in the prior two months. August's unemployment rate is expected to rise a tenth to 6.5 percent.

The Labour Force Survey is a key economic indicator giving an overall picture of employment and unemployment. Employment counts the number of paid employees working part-time or full-time in the nation's business and government establishments. The unemployment rate measures the number of unemployed as a percentage of the labor force.

As in the U.S., this report is used as an indicator of the health of the domestic economy. Employment trends and break-downs by industry groups highlight the strength in job creation and the implications for future sectoral activity. The unemployment rate is used as an indicator of tightness in labor markets and can foreshadow a future increase in wages. Labor force data provide investors with the earliest signs of industry performance. While other data are produced with a month or two delay, these data are available only a week to 10 days after the end of the latest month. Reactions can be dramatic - especially when the result is unanticipated.

The information in the report is invaluable for investors. By looking at employment trends in the various sectors, investors can take more strategic control of their portfolio. If employment in certain industries is growing, there could be investment opportunities in the firms within that industry.

The bond market will rally (fall) when the employment situation shows weakness (strength). The equity market often rallies with the bond market on weak data because low interest rates are good for stocks. But sometimes the two markets move in opposite directions. After all, a healthy labor market should be favorable for the stock market because it supports economic growth and corporate profits. At the same time, bond traders are more concerned about the potential for inflationary pressures.

The unemployment rate rises during cyclical downturns and falls during periods of rapid economic growth. A rising unemployment rate is associated with a weak or contracting economy and declining interest rates. Conversely, a decreasing unemployment rate is associated with an expanding economy and potentially rising interest rates. The fear is that wages will accelerate if the unemployment rate becomes too low and workers are hard to find.