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  • Writer's pictureNick Andriacchi

The Latest BLS Reports Show a Slightly Cooling Labor Market

Key Take - Away's

  • 152,000 people entered the workforce.

  • Average hourly earnings rose 0.4% for the month, good for a 4.4% annual pace, both above expectations.

  • Health care, social assistance, financial activities, and wholesale trade were the leading sectors for job creation. Leisure and Hospitality continue to level off as employees have come back after COVID.

  • The JOLTS report estimates that there are 9.6mm open jobs, a little lower than May. Quits also fell noticeably. 300,000 less workers quit their jobs in June.


Analysis of July Employment Report


Both the June JOLTS report and July Labor Report came in a little under economists’ expectations. The US Bureau of Labor & Statistics reported 9.6 million available jobs in June, the 3rd monthly decline in a row. The BLS also reported that 185,000 jobs were created in July and revised May and June totals lower.


Temporary Help, typically a leading indicator of the employment market, is down for the 2nd month in a row and has been generally lower over the last 8 months. Temp help employment is down about 9.5% when .compared with July 2022.



· A more encompassing measure of unemployment (U6) that includes discouraged workers and those holding part-time jobs for economic reasons is down to 6.7%.


· Prime age labor force participation rate (ages 25-54) was down .1% to 83.3%.


· The overall labor force participation was flat for the 5th straight month at 62.6%. This number is disappointing as it still sits .6% below the level of February 2020.


· In July, average hourly earnings for all employees on private nonfarm payrolls rose by 14 cents, or 0.4 percent, to $33.74. Over the past 12 months, average hourly earnings have increased by 4.4 percent. In July, average hourly earnings of private-sector production and nonsupervisory employees rose by 13 cents, or 0.5 percent, to $28.96.


· The average workweek for all employees on private nonfarm payrolls edged down by 0.1 hour to 34.3 hours in July. In manufacturing, the average workweek remained unchanged at 40.1 hours, and overtime was unchanged at 3.0 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls remained at 33.8 hours.


· APD is reported that 324,000 jobs were added last month.


Source: ADP, BLS, CNBC, Fox News



JOB OPENINGS AND LABOR TURNOVER – JUNE 2023


The number of job openings was little changed at 9.6 million on the last business day of June, the U.S. Bureau of Labor Statistics reported today. Over the month, the number of hires and total separations decreased to 5.9 million and 5.6 million, respectively. Within separations, quits (3.8 million) decreased, while layoffs and discharges (1.5 million) changed little. 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 June, the number of job openings was little changed at 9.6 million, while the rate was unchanged at 5.8 percent. In June, job openings increased in health care and social assistance (+136,000) and in state and local government, excluding education (+62,000). Job openings decreased in transportation, warehousing, and utilities (-78,000), state and local government education (-29,000), and federal government (-21,000).


Hires


In June, the number of hires decreased to 5.9 million (-326,000), while the rate was little changed at 3.8 percent. Hires decreased in durable goods manufacturing (-54,000) and in finance and insurance (-54,000).


Separations


Total separations include 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 include separations due to retirement, death, disability, and transfers to other locations of the same firm.


The number of total separations in June decreased to 5.6 million (-288,000), while the rate was little changed at 3.6 percent. Over the month, the number of total separations decreased in retail trade (-134,000), health care and social assistance (-84,000), and durable goods manufacturing (-54,000). The number of total separations increased in professional and business services (+129,000).


In June, the number and rate of quits decreased to 3.8 million (-295,000) and 2.4 percent, respectively. The number of quits decreased in several industries, with the largest decreases in retail trade (-95,000), health care and social assistance (-75,000), and construction (-51,000). The number of quits increased in arts, entertainment, and recreation (+20,000).


In June, the number of layoffs and discharges changed little at 1.5 million, and the rate held at 1.0 percent. Layoffs and discharges increased in professional and business services (+112,000). The number of layoffs and discharges decreased in durable goods manufacturing (-26,000) and in wholesale trade (-26,000).


The number of other separations was little changed in June at 339,000.


Establishment Size Class


In June, establishments with 1 to 9 employees saw a decrease in their quits rates and an increase in their other separations rates. Establishments with more than 5,000 employees saw increases in their quits

rates.

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The Job Openings and Labor Turnover Survey estimates for July 2023 are scheduled to be released on Tuesday, August 29, 2023, at 10:00 a.m. (ET).




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