Labor Day surprise! U.S. adds 1.37 million jobs in August, unemployment rate falls to 8.4%

The U.S. economy added 1.37 million jobs in August, and the unemployment rate fell to 8.4%, down from the July figure of 10.2%, the Labor Department reported Friday.

In April, the Congressional Budget Office (CBO) predicted the third quarter unemployment rate would hit 16%, nearly double the number released today. Economists predicted less optimistic figures than the August report ultimately produced. Though the August hiring number fell by 300,000 jobs from the July figure, the 8.4% number was more than a full point lower than the expected figure of 9.8%. 

President Trump was pleased with the jobs report on Friday morning, tweeting to his nearly 86 million followers, "Great Jobs Numbers! 1.37 Million Jobs Added In August. Unemployment Rate Falls To 8.4% (Wow, much better than expected!). Broke the 10% level faster and deeper than thought possible."

The report comes amid other positive economic news from August. Retail sales, real estate sales, and manufacturing numbers are up, easing out of their coronavirus dips. The stock market has also generally been on the rise, despite an 800-point tumble it took on Thursday before closing bell. On Wednesday, the Nasdaq climbed above 12,000 for the first time in history, though it fell with the rest of the indexes Thursday afternoon.

However, the pace of U.S. rehiring slowed in August, as workers continued to lose their jobs in some fields. One explanation is that the labor market is stalling slightly because of the lack of government stimulus spending. In July, the U.S. had 13 million fewer jobs than in February, prior to the onset of the coronavirus pandemic, the country is now looking at about 11.5 million fewer jobs. 

Late on Wednesday, Senate Majority Leader Mitch McConnell said "the cooperative spirit we had in March and April" between Capitol Hill lawmakers, has dissipated as we move closer and closer to the election."