Washington, Oct 3 (V7N) – Alternate data compiled from public and private sources, acting as a substitute for official statistics delayed by the ongoing federal government shutdown, indicate that the U.S. job market likely remained stagnant in September. Hiring activity was sluggish, while the unemployment rate remained unchanged, influenced in part by a declining number of foreign-born workers.
 
The U.S. federal government is experiencing its 15th shutdown since 1981, leaving approximately 750,000 federal employees furloughed. The shutdown has delayed the release of key economic reports, including the Bureau of Labor Statistics’ September unemployment and jobs data, which were originally scheduled for publication on Friday. These reports serve as critical references for Federal Reserve policymakers, who are set to convene in late October to decide on potential interest rate adjustments.
 
Other delayed reports include weekly jobless claims, factory orders, and August construction spending data. Depending on the duration of the shutdown, some data may still be available ahead of the Fed’s October 28-29 meeting. In the meantime, alternative sources, such as the “real-time” unemployment estimate released Thursday by the Federal Reserve Bank of Chicago, have gained prominence among economists, analysts, and policymakers seeking insight into current labor market conditions.
 
The Chicago Fed’s report, which integrates private-sector and available public data, estimated the September unemployment rate at 4.3%, unchanged from August. This figure suggests that a feared rapid rise in unemployment has not yet materialized.
 
However, the report also highlighted ongoing labor market sluggishness, reinforcing expectations that the Federal Reserve may proceed with another quarter-point reduction in the benchmark interest rate. Policymakers are closely monitoring whether the labor market is holding steady, with the 4.3% unemployment rate considered near full employment, or if it is at risk of a sharp downturn. The Fed last month reduced its policy rate by 25 basis points to a range of 4% to 4.25%, following slower job gains and a modest uptick in unemployment in August.
 
“We’re going to go off of the data we have,” said Chicago Fed President Austan Goolsbee on Fox News’ America Reports. He added that the new unemployment estimate “indicates some steadiness in the labor market,” suggesting a cautiously stable economic outlook despite the ongoing shutdown.
 
News Source: Reuters
 
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