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(Kitco News) – The U.S. labor market shows signs of cooling as the U.S. economy sees disappointing gains in private-sector jobs in August, according to private payrolls processor ADP.

Wednesday, ADP said that 177,000 jobs were created this past month. The data missed expectations as economists were looking for job gains of around 194,000.

“This month’s numbers are consistent with the pace of job creation before the pandemic. After two years of exceptional gains tied to the recovery, we’re moving toward more sustainable growth in pay and employment as the economic effects of the pandemic recede,” said Nela Richardson, chief economist at ADP, in the report.

However, the weaker-than-expected employment report appears to have little impact on gold prices. December gold futures are holding near session highs but are seeing little new momentum, last trading at $1,969 an ounce, up 0.19% on the day.

Analysts have been watching the labor market closely as it could determine when the U.S. central bank stops raising interest rates. The Federal Reserve has said that it would need to see some slack in the labor market as a condition of ending its current tightening cycle.

Along with weaker job growth, the report also noted a further slowdown in wage growth.

The report said that employees who stayed in their jobs this past month saw a year-over-year wage increase of 5.9%; at the same time, workers who changed jobs saw their wages increase 9.5% from last year. The report noted that slower wage growth was broad-based across the country.

“For the first time, all 50 states and Washington, D.C., experienced a slowdown in pay growth,” the report said.

The report noted that the lackluster job growth last month was led by the leisure/hospitality sector, which saw job gains of only 30,000. In comparison, this segment of the economy saw job gains of 200,000 in July.

Looking at the broader service sector, the report said 154,000 jobs were created last month. The trades/transportation/utilities industries saw job gains of 45,000; the information sector saw 5,000 new jobs created in August; 15,000 jobs were created in professional/business services; educational and health services sectors saw job gains of 52,000 and other services saw job gains of 7,000.

The report said that the broader manufacturing sector created 23,000 jobs in August. The mining/natural resource sector created 5,000 new jobs; 6,000 new positions were created in the construction industry and the manufacturing sector saw job gains of 12,000.

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