HEADLINES:
- 1,371,000 million jobs gained. The gains since May total about 48% of the 22.1 million job losses in March and April. The alternate and more volatile measure in the household report was 3,756,000 jobs gained, which factors into the unemployment and underemployment rates below.
- U3 unemployment rate fell -1.8% from 10.2% to 8.4%, compared with the January low of 3.5%.
- U6 underemployment rate fell -2.3% from 16.5% to 14.2%, compared with the January low of 6.9%.
- Those on temporary layoff decreased 3.1 million to 6.2 million.
- Permanent job losers increased by 534,000 to 3.1 million.
- June was revised downward by -10,000. July was also revised downward by -29,000 respectively, for a net loss of -39,000 jobs compared with previous reports.
Leading employment indicators of a slowdown or recession
I am still highlighting these because of their leading nature for the economy overall. These were positive:
- the average manufacturing workweek rose 0.2hours from 40.7 hours to 40.9 hours. This is one of the 10 components of the LEI and will be a positive.
- Manufacturing jobs rose by 29,000. Manufacturing has still lost-720,000 jobs in the past 6 months, or -5.6% of the total. 53% of the total loss of 10.6% has been regained.
- Construction jobs rose by 16,000. Even so, in the past 6 months -225,000 construction jobs have been lost, -5.6% of the total. Almost 2/3’s of the worst loss of 15.2% loss has been regained.
- Residential construction jobs, which are even more leading, rose by 3,200. Even so, in the past 6 months there have still been -21,200 lost jobs, or about 2.5% of the total.
- temporary jobs rose by 106,700. Since February, there have still been -471,900 jobs lost, or 16% of all temporary help jobs.
- the number of people unemployed for 5 weeks or less fell by -921,000 to 2.281 million, compared with April’s total of 14.283 million.
- Professional and business employment rose by 197,000, which is still -1.475 million, or about 7%. below its February peak.
Wages of non-managerial workers
- Average Hourly Earnings for Production and Nonsupervisory Personnel: rose $0.18 from $24.63 to $24.81, which is a gain of 3.5% in the 6 months since the pandemic began. Gains had previously reflected that job losses were primarily among lower wage earners, who have been disproportionately recalled to work. That we have increased employment and increased wages as well is a very positive development.
Aggregate hours and wages:
- the index of aggregate hours worked for non-managerial workers rose by 1.0%. In the past 6 months combined this has nevertheless fallen by about -8.5%.
- the index of aggregate payrolls for non-managerial workers rose by 1.7%. In the past 6 months combined this has nevertheless fallen by about -6.4%.
Other significant data:
- Full time jobs were responsible for 2.837,000 of the gain in the household report.
- Part time jobs were responsible for 991,000 of the gain in the household report.
- The number of job holders who were part time for economic reasons fell by -871,000 to 7.572 million. This is still an increase since February of 3.254 million.
A special note: Included in the total were 238,000 census hires. Without these, the net gain in jobs was 1,133,000.
SUMMARY
This was another positive report, but with some shades of difference. The establishment survey was the smallest gain in the past 4 months, even before census hires are taken in to account. By contrast, the household report, which determines the unemployment rate, was much stronger.
All of the leading indicators in the report were positive. Further, that average hourly wages for nonsupervisory jobs rose along with the number of recalls was very good news on the wage front.
The one significant concern is that the number of permanent job losses increased to a level on par with April and June, the worst months since the pandemic hit. This is a sign that areas of unemployment are becoming permanent and will not automatically rebound with the control of the coronavirus.
All in all, the message is that of continued substantial, but incremental, gains since the April bottom in jobs. At the rate of gains in the past two months, it would take another 8 months to regain all the jobs lost in the first two months of the pandemic
Politically, this is *relatively* helpful to the Trump campaign, but it is by no means good enough to overcome the huge losses overall this year. There will only be one more jobs report before the election, and unless there is a miracle in the next month – which is needless to say very unlikely – Trump is going to face Election Day with a poor jobs record.
You mean the BLS lied again????
Aviation is going to lag a virus recovery for several years to the extent it will be hard to describe when it has recovered really. If the pandemic has created new ways of doing business that cuts 25% of business travel out of firms budgeting, well does that lower the “full recovery” target? Is it the kind of experience that dampens pleasure travel rates for a long time after the pandemic recedes? The run up of tech stocks looks to me partly a bet that virtual human experiences will grow greatly at the expense of corporal ones.
US added 1.4 million jobs in August as unemployment fell to 8.4%
NY Times – September 4
Employers continued to bring back furloughed workers last month, but at a far slower pace than in the spring, and millions of Americans remain out of work.
The U.S. economy added 1.4 million jobs in August, the Labor Department said Friday, down from 1.7 million in July and down sharply from the 4.8 million added in June. Payrolls are still more than 11 million jobs below their pre-pandemic level.
The unemployment rate fell to 8.4 percent, down significantly from 14.7 percent in April and 10.2 percent in July. The drop brings the rate below the peak of the last recession a decade ago, when unemployment briefly hit 10 percent, but joblessness is still higher than the peak of many past recessions. …
https://wolfstreet.com/2020/09/03/big-setback-for-the-unemployment-crisis-week-24-of-u-s-labor-market-collapse/
“Powered by a nasty jump in continued unemployment claims under the federal Pandemic Unemployment Assistance (PUA) program for contract workers, established under the CARES Act, total continued claims under all state and federal programs jumped by 2.2 million, “not seasonally adjusted,” to 29.2 million people on unemployment rolls, the highest since August 1, according to the Department of Labor this morning.” ??????wtf?????
Yes, those workers are counted as created jobs…….lol. It’s gotta go. If I was Biden, I would demand Pelosi nix it or no new deal.
I was wondering about the effect of the census hiring. Back in 2010, just about every employment chart showed the numbers with and without census hiring. This time, no one seems to have bothered.
“Powered by a nasty jump in continued unemployment claims…”
This is incorrect, continuing claims decreased, whether in data seasonally adjusted or not.
There were 233,000 temporary Census jobs added, beyond the 1.1 million additional jobs created.
Anne, your wrong. He is counting all claims that ppp/pua cover. It surged. Go to Richtors site and educate yourself.
Bert:
Anne is a smart lady. I would be nice to her.
https://fred.stlouisfed.org/graph/?g=vfph
January 15, 2020
Continued Claims for Unemployment Insurance, * 2020
* Not Seasonally and Seasonally Adjusted
https://cepr.net/jobs-2020-09/
September 4, 2020
Economy Adds 1.4 Million Jobs in August, Unemployment Falls to 8.4 Percent
By DEAN BAKER
Even with strong job growth the last four months, we have recovered less than half the jobs lost due to the pandemic.
The August employment report showed the economy again adding back jobs at a strong rate. The reported gain of 1,371,000 somewhat overstates underlying strength since it includes the addition of 238,000 temporary Census jobs. However, even without these jobs, the gain would still be over 1.1 million. The unemployment rate dropped 1.8 percentage point to 8.4 percent, while the employment-to-population ratio (EPOP) rose 1.4 percentage point to 56.5 percent. (The Bureau of Labor Statistics warns that due to misclassification, the unemployment rate may actually be 0.7 percentage points higher than reported. The size of this error is considerably lower than in April or May, but comparable to its July level.)
The hit from the pandemic continues to skew to the more disadvantaged groups in the labor market. The unemployment rate for whites fell by 1.9 percentage points to 7.3 percent, while for Blacks it dropped 1.6 percentage points to 13.0 percent. Hispanics fared somewhat better with a drop of 2.4 percentage points to 10.5 percent. Since the April peak, white unemployment is down 6.9 percentage points, while Black unemployment is down by 3.8 percentage points from a peak in May. Hispanic unemployment has fallen 8.4 percentage points from its peak. Asian unemployment is extraordinarily high at 10.7 percent, down by just 4.3 percentage points from the May peak. The unemployment rate for Asians is typically comparable to or lower than whites.
By education, the unemployment rate for college grads stands at 5.3 percent, compared to 9.8 percent for those with just a high school degree. That compares with year-ago rates of 2.1 percent and 3.6 percent, respectively. For those with some college it is 8.0 percent.
One disturbing part of this picture is a sharp drop in the share of the unemployed who report being on temporary layoff from 56.4 percent to 45.5 percent. This is partly due to these workers getting their jobs back, but also due to many layoffs becoming permanent. Still, it is encouraging that close to half of the unemployed expect to be returning to their former jobs.
[Graph]
In this respect, it is striking that the number of people who report being self-employed is actually up from the year ago level. While the number of unincorporated self-employed is down slightly from 9,681,000 to 9,603,000, the number of incorporated self-employed, who are generally viewed as more established, rose by 178,000 to 6,327,000.
On the less encouraging side, the share of long-term unemployed (more than 26 weeks) rose from 9.2 percent to 12.0 percent. Historically, the long-term unemployed have had far more difficulty finding new employment.
The biggest job gainers by industry were ones that had been hit hard by the shutdowns. Retail added 248,900 jobs, accounting for almost a quarter of the private sector job growth. Employment in the sector is now 655,400 (4.2 percent) below the February level. Restaurants added 133,600 jobs, but industry employment is still down by almost 2.5 million (20.2 percent) from the pre-pandemic level.
Employment services added 126,300 jobs, but that still left employment down by more than 550,000 (15.1 percent) from the February level. Health care added 75,300 jobs, leaving employment down by more than 700,000 (4.3 percent) from February levels. Private educational services added 56,900 jobs, possibly due to efforts to cope with remote learning.
There was surprisingly weak job growth in some areas. Hotels added just 15,400 jobs, leaving employment more than 780,000 (37.3 percent) below the February level. Job growth in construction and manufacturing was also surprisingly weak, adding 16,000 and 29,000 jobs, respectively. Compared to February, construction employment is down by 425,000 (5.6 percent), while manufacturing employment is down by 720,000 (5.6 percent).
The airline industry added back just 7,500 jobs in August, leaving employment down more than 100,000 (21.1 percent) from February. The movie industry added 13,900 jobs, but employment is still down by almost 230,000 (50.0 percent) from February’s level. Personal and laundry services added 13,900 jobs, leaving employment down by 288,000 (18.7 percent) from February.
State government employment fell by 2,000, while local government employment rose 95,000. Employment in these sectors is down, respectively, by 218,000 (4.2 percent) and 909,000 (6.2 percent). Since much government employment is in education, and therefore highly seasonal, it is difficult to make too much of the monthly changes at the end of the summer, but it is virtually certain we will see more layoffs if additional federal money is not forthcoming.
On the whole, this is a positive report, with the addition of more than 1 million private sector jobs, but we are still down 10.7 million from the February level, having recovered less than half the April job loss. With momentum clearly slowing and large public sector layoffs looming, it is difficult to be too optimistic.