US employment fell for the first time in seven years in September due to the impact of hurricanes Harvey and Irma.
Official figures showed non-farm payrolls decreased by 33,000 after the storms wreaked havoc in Texas and Florida, reflecting a record drop off in employment in restaurants and bars in the affected areas.
They underlined the scale of the impact of the storms in August and September on the world’s biggest economy.
It was the first fall in the closely watched number since September 2010 and compares with economists’ expectations of a 90,000 increase. In August, the US added 169,000 jobs.
But Harvey and Irma did not have an impact on the overall jobless rate – which uses different criteria and a smaller sample and dropped to 4.2%, the lowest level since February 2001.
Image: Harvey caused catastrophic flooding in Houston and other parts of Texas and Louisiana
The figures showed 1.5 million people stayed at home in September because of the bad weather, the largest such impact since January 1996. It also resulted in about 2.9 million people working part-time.
Still, there were signs that the wider jobs market remained healthy – and expectations that those displaced by the storms will return to work, while re-building and clean-up operations will boost employment in coming months.
Meanwhile, annual wage growth ticked up to 2.9%, up from 2.7% in August.
That helped the dollar climb, as the jobs report did little to dispel expectations that the US Federal Reserve will hike interest rates in December.
Fed chair Janet Yellen said last month that the hurricanes could “substantially” weigh on jobs growth in September but added that the effects would “unwind relatively quickly”.
Economists have estimated that the series of storms that have afflicted the US and neighbouring regions could dampen third quarter growth figures.
But James Knightley, chief international economist at ING Bank, said: “This positive overall story on the labour market is only going to strengthen the case for higher interest rates.”