Employment: Further Rebound in Jobs, Still Down 12.9 Million
August 7, 2020
Bottom Line: Job gains were slightly better than expected in July as the economy added 1.76 million new jobs, continuing a three-month rebound from the shocking losses of over 20 million jobs in April as shutdowns for the novel coronavirus took hold. Leisure and hospitality jobs as well as retail trade and health care service jobs have dominated the volatility and rebounded further in July. But public education jobs also led the gains in July as schools in many parts of the country reopened. The household survey used to calculate the unemployment showed gains nearly as strong as the establishment survey (used to tally payrolls, pushing the unemployment rate down to 10.2% from 11.1% as labor force participation slipped slightly. Average hourly earnings rebounded, a good sign that many of the jobs created were slightly higher-paying jobs. Remember that earnings rose sharply in April when jobs were lost as most of the losses were in lower-paying jobs and then earnings fell as those employees were re-hired in May and June. Overall, this report showed the labor market rebound continued in July, albeit at a slower pace of gains than in May and June. Jobs gained in the rebound are still a fraction of those lost in April with payrolls lower by nearly 12.9 million since February.
Payroll Employment rose by 1,763k in July, compared with market expectations for an increase of 1480k. The prior 2 months were revised, lower in June by 9k, and higher in May by 26k.
Government jobs ROSE by 301k. Consequently, private sector jobs ROSE by 1462k. Private education jobs rose by 24k. State and Local education jobs rose by 245k.
Overall employment is now -7.5% BELOW its year-ago level, Over the past 12 months, 11,371k jobs have been created.
In July, the job gains were in :
- Trade, Transportation & Utilities (+33k with 258k of those in Retail Trade),
- Professional & Business Services (+170k with the addition of 143.7k in Temp Help Services),
- Leisure & Hospitality (+592k),
- Government (+301k),
- Education & Health Services (+191k),
- Other Services (+149k),
- Manufacturing (+26k), and
- Financial Activities (+21k).
Article by
Contingent Macro Advisors