The August jobs report had something in it for everybody. The overall job market was still strong but cooling a little. Wage growth, while still strong came in a little below expectations. Most importantly, the labor participation rate recorded a big gain last month as many more people returned to the workforce – which I believe will be the biggest cure to our inflation woes.
The Headlines
The biggest sector gainers were professional and business services, health care and retail.
While the overall unemployment rate ticked up to 3.7%, I consider that good news because it was primary due to an increase in the labor participation rate (62.4% overall, 82.8% prime age).
Full-time jobs fell by 242,000 while part-time positions gained by 413,000, according to the household survey, which the BLS uses to compute the headline unemployment rate.
The BLS lowered the June payrolls count to 293,000 from 398,000 and July’s to 526,000 from 528,000, a combined net drop of 107,000 from previous estimates.
Analysis of the August Employment Report
· A more encompassing measure of unemployment (U6) that includes discouraged workers and those holding part-time jobs for economic reasons is at 7%.
· Prime age labor force participation rate (ages 25-54) was up this month to 82.8%. This is a very encouraging sign and it is now off by just .3% from February 2020, the last month before the pandemic started.
· The overall labor force participation is 62.4% up .3% from last month.
· In August, average hourly earnings for all employees on private nonfarm payrolls rose by 10 cents, or 0.3 percent, to $32.36. Over the past 12 months, average hourly earnings have increased by 5.2 percent. In August, average hourly earnings of private-sector production and nonsupervisory employees rose by 10 cents, or 0.4 percent, to $27.68.
· The average workweek for all employees on private nonfarm payrolls decreased by 0.1 hour to 34.5 hours in August. In manufacturing, the average workweek for all employees was little changed at 40.3 hours, and overtime held at 3.3 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls declined by 0.1
hour to 33.9 hours.
· APD reported that 132,000 jobs were added in last month.
Source: ADP, BLS, CNBC, ABC News
JOB OPENINGS AND LABOR TURNOVER – JULY 2022
The number of job openings was little changed at 11.2 million on the last business day of July, the U.S. Bureau of Labor Statistics reported today. Hires and total separations were little changed at 6.4 million and 5.9 million, respectively. Within separations, quits (4.2 million) and layoffs and discharges (1.4 million) were little changed. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.
Job Openings
On the last business day of July, the number and rate of job openings were little changed at 11.2 million and 6.9 percent, respectively. Job openings increased in transportation, warehousing, and utilities (+81,000); arts, entertainment, and recreation (+53,000); federal government (+47,000); and state and local government education (+42,000). Job openings decreased in durable goods manufacturing (-47,000).
Hires
In July, the number of hires was little changed at 6.4 million and the rate was unchanged at 4.2 percent. Hires were little changed in all industries. (See table 2.)
Separations
Total separations includes quits, layoffs and discharges, and other separations. Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations includes separations due to retirement, death, disability, and transfers to other locations of the same firm.
In July, the number and rate of total separations were little changed at 5.9 million and 3.9 percent, respectively. Total separations increased in transportation, warehousing, and utilities (+65,000).
In July, the number and rate of quits were little changed at 4.2 million and 2.7 percent, respectively. Quits decreased in health care and social assistance (-73,000) and in state and local government education (-21,000). Quits increased in transportation, warehousing, and utilities (+39,000).
In July, the number of layoffs and discharges was little changed at 1.4 million and the rate was unchanged at 0.9 percent. Layoffs and discharges were little changed in all industries.
The number of other separations was little changed in July at 352,000. Other separations increased in wholesale trade (+10,000); information (+8,000); and nondurable goods manufacturing (+6,000). Other separations decreased in accommodation and food services (-25,000) and in federal government
(-4,000).
Establishment Size Class
In July, the hires rate increased in establishments with 1,000 to 4,999 employees. The layoffs and discharges rate increased in establishments with 250 to 999 employees but decreased in establishments with 1,000 to 4,999 employees. For a more in-depth description of the JOLTS establishment size class estimates, please visit www.bls.gov/jlt/sizeclassmethodology.htm.
____________
The Job Openings and Labor Turnover Survey estimates for August 2022 are scheduled to be released on Tuesday, October 4, 2022 at 10:00 a.m. (ET).
·
Comments