Will the unemployment rate (U-3) be above 4.0% in August?
Signal ended
Entry · YES76¢
PublishedSep 3
Sep 3 forecast
July’s 4.1% rate and forecasts centered above the cutoff provide a buffer, so an August U-3 rate above 4.0% is likely.
Most direct August assessments place unemployment at 4.1% or 4.2%, while weak payroll growth and a possible participation rebound support an increase. Low claims and declining layoffs create meaningful uncertainty because a one-tenth drop from July would fail the condition. Overall, an August rate above 4.0% is likely, but the narrow margin leaves room for a surprise.
Points to YES
- The latest official unemployment rate already stands one tenth above the cutoff.The July employment report, published August 7, put the U.S. unemployment rate at 4.1%.
- Pre-release estimates center above the threshold rather than at its boundary.On September 2, FactSet forecasts centered on the August unemployment rate rising from 4.1% to 4.2%.
- Weak private payroll growth suggests labor demand remained subdued in August.On September 2, private payroll growth was reported at 38,000 for August, down from 46,000 in July.
Points to NO
- Low and falling jobless claims point to limited deterioration in employment.For the week ending August 22, initial unemployment claims fell to 203,000 from 207,000.
- Declining layoffs reduce pressure for the unemployment rate to rise.The September 1 report showed July layoffs and discharges falling by 119,000 to 1.666 million.
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