US Jobs Report Expected to Disappoint

(MarketWatch) - The U.S. economy likely added private sector jobs last month, but hiring is still not happening fast enough to reduce the nation's high jobless rate, MarketWatch said Thursday.

The government will present a finer-grained view of the labor market Friday morning when it reports employment data for August. Economists surveyed by MarketWatch forecast a net gain of 30,000 private-sector jobs, but an overall decline of 105,000 as the Census winds down.

Earlier this year the federal government hired tens of thousands of temporary workers to conduct the regular 10-year Census of the U.S. population, but those workers are being let go.

"The important number is the private payrolls," senior economist Ryan Sweet of Moody's Economy.com said. "If we see a much weaker number it will be a red flag. The economy is already very fragile."

The official unemployment rate is seen edging up to 9.6 percent. The figure would be even higher if it included discouraged workers -- those who can only find part-time work or none at all.

In normal times, the U.S. needs to add 100,000 to 150,000 jobs a month to absorb the natural increase in the working population and trim the unemployment rate, economists say.

So far this year the economy has added about 90,000 private sector workers a month, though most of the increase took place in the early spring. Job growth tapered off over the summer.

Yet with unemployment near a 27-year high of 9.5 percent, hiring would have to increase even faster to put most people back to work quickly, said Nigel Gault, chief U.S. economist of IHS Global Insight.

The jobs report has taken on extra significance as Democrats and Republicans lock horns ahead of the November elections. Republicans have been attacking President Barack Obama's economic policies as ineffective and they are prepared to resume their assault if job growth in August proves anemic.

The latest polls indicate Republicans have a chance to recapture one or both Houses of Congress amid discontent with the weak economy.

Democrats, for their part, are hopeful that hiring turns out better than expected. Obama and other leading Democrats insist their policies, such as last year's massive $814 billion stimulus, are working but need more time.

Read more: MarketWatch