US hiring slowed to an 11-month low in September

By Updated at 2017-10-04 16:44:29 +0000


(Reuters) - U.S. companies scaled back their hiring to an 11-month low in September after two powerful hurricanes disrupted some business activities, while the vast domestic services sector overcame those snags to expand at its fastest pace in 12 years.

The latest data helped soothe investors who have been worried about Hurricanes Harvey and Irma dragging on U.S. economic growth.

“We have to at least entertain the notion that an economy that was already in pretty solid shape cyclically is picking up momentum heading into the fall,” said Stephen Stanley, chief economist at Amherst Pierpont Securities.

The Institute for Supply Management’s index of non-manufacturing activity rose to 59.8, the highest since August 2005.

The September figure topped expectations of 55.5 from a Reuters poll of economists and was up from 55.3 the month before. A reading above 50 indicates growth in the sector.

The two storms did cause delays in supply deliveries and a drawdown on inventories, according to ISM.

U.S. companies added 135,000 jobs in September, the smallest monthly increase since October 2016, as Harvey and Irma “significantly impacted smaller retailers,” the ADP National Employment Report showed earlier on Wednesday.

Still, those gains managed to top economist expectations for an addition of 125,000 jobs.

Private employers likely reduced their hiring by 50,000 to 60,000 last month due to disruptions from Harvey and Irma, Moody’s Analytics chief economist Mark Zandi said on a conference call.

Wall Street’s three major equity indexes were modestly lower after the ADP and ISM data but later reversed losses and climbed to record highs. Bond yields rose and the dollar pared initial losses.

Reporting by Richard Leong; Editing by Meredith Mazzilli