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Jobless rate holds steady
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September 4, 1998: 10:50 a.m. ET
Unemployment unchanged at 4.5% in August with 365,000 new jobs created
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NEW YORK (CNNfn) - The unemployment rate remained unchanged in August amid a sharp rise in new jobs as workers returned after two General Motors Corp. strikes, the Labor Department reported Friday.
The unemployment rate remained at 4.5 percent as businesses created 365,000 jobs outside the farm sector, a sharp rise from the revised 68,000 in July. July's figures, however, were severely affected by the GM strikes.
Economists had forecast an unemployment rate of 4.4 percent with 370,000 new jobs created.
Discounting the return of striking GM workers, non-farm payroll increased by 215,000.
Economists said August employment figures indicate the U.S. economy remains strong.
"I think it's good news for the economy," said Gary Thayer, senior economist at A.G. Edwards. "When you take away the GM strike and average last month's figures with this month's, you see employment growth at moderate levels, which is good for sustainable growth."
The bond market showed little reaction to the news as the benchmark 30-year Treasury bond slipped 8/32 in price for a yield of 5.31 percent.
The Labor Department reported average hourly earnings rose 7 cents to $12.86 in August. That represents a 4.2-percent gain from year-ago levels.
The average workweek was unchanged at 34.6 hours; the average hours for factory workers also were unchanged at 41.7, though factory overtime dropped by 0.3 hour to 4.4 hours.
Labor Secretary Alexis Herman said the hourly wage increase isn't a point of concern because productivity also increased.
"Both are averaging about 2 percent," Herman told CNNfn. "That's the kind of balance we're looking for in the economy."
One figure Herman found troublesome, however, was the rise in jobs in the manufacturing sector. Most of the 95,000 new manufacturing jobs created in August resulted from the end of the GM strike.
Discounting those figures, the manufacturing sector would have posted a loss of 55,000 jobs, largely because of a slowdown due to the economic crisis in Asia.
"Of greatest concern to me is the relationship of the manufacturing sector to the Asian market and the need to bring stability to that area," Herman said. 
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Labor Department
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