US jobs growth slows in September

The job situation is a key concern for American voters

The US economy added 96,000 new jobs in September, according to the last major employment data before the presidential election in November.

Economists had predicted a figure closer to 150,000.

The data may well sharpen a debate between President George W Bush and challenger John Kerry on Friday evening.

For Mr Bush, the gain shows continued recovery, but Mr Kerry is likely to point out that Mr Bush will finish his term on a net loss of US jobs.

"The verdict is in: with 1.6 million private sector jobs lost during his term, President Bush will be the first President in 72 years to face the electorate with an economy that has lost jobs under his watch," Mr Kerry said in a statement.

Polls indicate that jobs and the state of the economy are among voters' main concerns, ahead of the war in Iraq.

Mixed message

The September figure represents a slowdown from August, when the US economy added 128,000 new jobs - revised down from an earlier estimate of 144,000.

"You would have to be a politician on the campaign trail to spin it as good news," said Sean Callow, currency strategist at Ideaglobal.

"The report does seem to indicate that the soft patch of economic data continues."

Even so, the figures showed "the strength and resilience of our economy and that the labor market continues to improve", said labour secretary Elaine Chao.

The data comes from the non-farm payroll survey - a key indicator of US economic health - published by the Labor Department.

There are still fewer people in employment now than there were when President Bush took office The BBC's Andrew Walker How the jobs data could influence the US presidential election

September's growth, the Labor Department said, came as a result of "modest job gains... in a few service-providing industries" such as professional services.

Retailing, in contrast, showed a 15,000 seasonally-adjusted decline, bearing out recent indications of a fall in consumer sentiment.

Meanwhile, manufacturing employment fell by 18,000.

Recent hurricanes in the southern US may have exacerbated the slowdown, the Commerce Department said, but "not enough to change materially" its estimates.

Keeping pace

The payroll figures have been at the heart of fierce arguments, both between politicians and among economists.

Earlier in 2004, the survey showed the US economy had managed to create almost a million new non-farm jobs between March and May.

The White House has pointed to the increase as proof that the administration's deep tax cuts had helped turn the economy around.

The Fed's chairman says the payroll survey is the one to watch

But critics have charged that the total for the year so far - averaging some 170,000 a month - fails even to keep pace with the growing population, and with White House predictions of some 320,000 extra jobs a month through 2004.

Choice of surveys

Pro-White House commentators say the payroll survey fails to pick up the growth in self-employment.

They focus instead on a survey of households, which has tended to show a brighter picture.

But the payroll survey remains the most generally respected one, as Federal Reserve chairman Alan Greenspan acknowledged earlier this year.

"I wish I could say the household survey were the more accurate,'' he told the House of Representatives in February.

"Everything we've looked at suggests that it's the payroll data which are the series which you have to follow.''