Headline September job growth missed estimates, but the positive revisions to the July and August readings were bigger than the September miss. This explains why it’s best to look at the report holistically. There’s a temptation to just look at the most recent month to get an early look at the economy, but sometimes the data shifts. Ultimately, it should make no difference in your analysis if job growth occurs on August 29th or September 2nd.

Specifically, the July jobs report was revised to show 165,000 jobs were created instead of 147,000. The August report was sharply revised higher from 201,000 to 270,000. As you can see, there were 87,000 more jobs created in the prior two months than were initially reported. That improvement is more than the September miss. 180,000 jobs were expected to have been added in September, but only 134,000 jobs were created. When you look at the headline report from that perspective, the results weren’t bad.

Bad Weather Was A Minor Factor

Hurricane Florence was a minor factor on this jobs report. Since the headline only missed by 46,000, this factor had a big influence on the miss. As you can see from the chart below, there were over 300,000 people who weren’t at work due to bad weather in September. This is more than the average which is below 250,000. 

Source: Renaissance Macro Research

The bars in the chart only show data from September, making it easy to see how the combined effect of hurricanes Maria, Harvey, and Irma was much more severe than hurricane Florence. This gives you an idea of how much of an impact hurricane Florence will have on Q3 GDP growth (it’s estimated to be from 0.2% to 0.3%).

Hurricane Florence likely had the biggest impact on the retail trade and leisure and hospitality industries. Since we know which industries were hit the hardest, we can look at the job creation in each industry to see the impact. As you can see from the chart below, the retail trade industry lost 20,000 jobs, which was much less than the 1-year average where it has added about 10,000 jobs per month. The leisure and hospitality industry lost 17,000 jobs instead of adding about 20,000 jobs.