Unemployment Rate Edges up to 9.6%

(Payrolls article updated with additional detail and commentary.)

NEW YORK (TheStreet) -- The nationwide unemployment rate pushed up to 9.6% last month, from 9.5% in July, the Labor Department said early Friday.

Nonfarm payrolls lost 54,000 jobs in August. Consensus projections provided by Briefing.com were calling for the headline number to drop by 120,000. The smaller-than-expected decline indicates the rate of job loss is easing.

Wall Street reacted quickly. Futures for the SPDR S&P 500(SPY), an exchange-traded fund that tracks the S&P 500, gained 1.2% in pre-market trading. The SPDR Dow Jones Industrial Average(DIA) and PowerShares QQQ Trust(QQQQ) each pushed up 1.1% ahead of the opening bell.

Further evidence of stabilization in the labor market came from a government report Thursday that showed fewer Americans filed for initial unemployment benefits last week than had been expected.

Temporary census-related jobs dropped by 114,000. Excluding census workers and other government workers, the private sector grew by 67,000 in the month, easily topping expectations for a gain of 30,000, and less than the revised 107,000 private-sector job gains in July.

The report also showed that 123,000 fewer jobs were lost in June and July than previously thought.

The nationwide unemployment rate of 9.6% represents the highest rate since May, and was in line with expectations.

Average hourly earnings edged up by 0.3%, or 3 cents, to $19.08. That beat expectations for a 0.1% uptick.