Despite the US posting disappointing job growth figures in August, the country's unemployment rate has fallen, new statistics show.

The US economy added 169,000 jobs in August, the US Labor Department reported on Friday, fewer than the 177,000 expected by analysts.

The prior two months' job numbers were also revised sharply lower, slashing July jobs growth to 104,000.

The unemployment rate, however, was down a tenth of a point to 7.3 percent, the lowest rate since December 2008, but for the reason that fewer people were actively seeking jobs.

The average forecast was for the jobless rate to hold unchanged from July at 7.4 percent.

Quantitative easing

Most analysts said the weak August labour report would not discourage the US Federal Reserve from tapering its $85bn-a-month asset-purchase programme, known as quantitative easing, as soon as its September 17-18 monetary policy meeting.

The data suggest that a weak labour market is forcing people to take bad jobs,

Dean Baker, Center for Economic and Policy Research

"The August employment report was a touch weaker than we expected but it doesn't change our expectation that the Fed will begin dialling back its pace of asset purchases later this month," said Ryan Sweet, senior economist at Moody's Analytics.

"The Fed is going to look at the big picture," Sweet said.

The Fed has hinged any taper on continued broad improvement in the economy.

A batch of recent positive data would support that view, including an upward revision to second-quarter US economic growth to 2.5 percent, a strengthening housing market, robust auto sales, and strong ISM manufacturing and services sector surveys.

Although the 7.3 percent jobless rate marked a new low after the recession ended four years ago, it was not a sign of underlying strength in the labour market, the new statistics showed.

The labour force participation rate fell to 63.2 percent in August as the workforce shed more than 300,000 people.

The biggest job gains were in retail and leisure and hospitality restaurant, sectors that typically pay low wages.

"The data suggest that a weak labour market is forcing people to take bad jobs," said Dean Baker of The Center for Economic and Policy Research.

Source: Al Jazeera and agencies