NEW YORK (Reuters) - Jobs growth was stronger than expected in September thanks to private-sector growth, easing fears the economy is slipping back into recession, but the unemployment rate was unchanged.
* Nonfarm payrolls rose 103,000 the Labor Department said on Friday, while the unemployment rate held steady at 9.1 percent as an increase in household employment offset a rise in the participation rate.
* Part of September's relative strength reflected the return of 45,000 Verizon Communications workers who had dropped off payrolls in August due to a strike. Excluding those workers, payrolls increased by 58,000.
* The tenor of the report was strengthened by revisions that showed 99,000 more jobs added in July and August than initially reported. In addition, hourly earnings rebounded and the average work week rose.
ELLEN ZENTNER, SENIOR U.S. ECONOMIST AT NOMURA SECURITIES, NEW YORK:
"The upward revision to August and July is great -- 99,000, we'll take it.
"You still got a pretty weak trend for payroll growth, 58,000 in September if you take out those (striking) Verizon workers. But that being said, the upward revisions to the prior two months puts at a three-month moving average of 96,000.
"Without those upward revisions, we had been expecting a three-month moving average of closer to 40,000. This shows that of the many factors that broadsided the economy in August, we were able to hang on in August and further create more jobs in September.
"We're still not at any kind of job level that could bring the unemployment level down, that still remains a big concern for the economy.
"But nevertheless the stronger than expected rise in non-farm payrolls today helps provide a little bit of relief to the markets that the U.S. economy is still hanging onto to recovery."
ROBERT LUTTS, PRESIDENT, CHIEF INVESTMENT OFFICER AT CABOT MONEY MANAGEMENT:
"Clearly a more positive number than last month and the revision for August was favorable. It basically means the U.S. economy rather than entering a double dip is in neutral.
"The markets will sigh a little bit of relief as this is bolstering the case we are not entering a double dip but sort of muddling through.
"We have been seeing many companies announcing cutbacks, governments are cutting back so we could see a couple more months of challenging employment data."
JACK ABLIN, CHIEF INVESTMENT OFFICER, AT HARRIS PRIVATE BANK IN CHICAGO:
"This is critical, this is the most important data that we have seen this cycle... This is going to get people's attention."
"This confirms that most of the negativity we have seen in the market is derived from the market itself and not the data," he said."
JOHN DOYLE, CURRENCY STRATEGIST, TEMPUS CONSULTING, WASHINGTON
"The way the market's been recently, we'll take any bit of good news. This removes some of the concern that the labor market is getting worse. Stock futures shot up and the dollar fell -- a pure risk-on reaction. If the euro runs beyond $1.3550, it could be a really tough day for the dollar. The revisions from last month were positive and give people a slightly brighter view of the landscape. But overall, this still isn't that many jobs, so while it's better than it could be, it's not great."
BRIAN DOLAN, CHIEF STRATEGIST, FOREX.COM, BEDMINSTER, NEW JERSEY:
"It's a breath of fresh air and should allow the risk recovery we've had this week to continue. It's still just one month's worth of data and the drop in the ISM employment index bodes ill for the coming months. This number is likely distorted, too, by the return of the Verizon strikers. But even so, revisions to the prior month were positive and the household survey showed a larger increase as well.
"All in all, it suggests a continuation of the risk recovery and that the U.S. will outperform other developed economies. That means the dollar should weaken and the yen crosses should move higher as people take on more risk."
KURT KARL, CHIEF U.S. ECONOMIST, SWISS RE, NEW YORK:
"They look awfully good relative to last month. It is very hard to tell what it means because you average the two months and you are still looking at 50,000 each, but certainly it is very promising. Hopefully it is sustainable and continues so that we can avoid recession. If we keep up like this we will certainly avoid that."
VIMOMBI NSHOM, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS:
"Although positive and above consensus (60k), the growth was not enough to reduce the unemployment rate, which is still at 9.1%. The market had expected a smaller count based on some 'corrective' movement in both the private and public sector, which had depressed August's nonexistent payroll growth (which is now reported as having added 57k jobs). In addition to August's revision, July payrolls at 127k (originally 85k) expands the job market by 99k than originally thought. Today's report amounts to 287k jobs created in Q3. The expected suppressive and supportive influences to detract and add to jobs creation did materialize in September -- those being a decline in government payrolls and a extra boost from the information sector."
STOCKS: U.S. stock index futures turned positive BONDS: U.S. bond prices extended losses FOREX: The dollar rose against the yen and fell vs the euro