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MNI DATA IMPACT: US Jobs Growth Slows to 1.8M in July

MNI (Washington)

The U.S. economy added back 1.763 million jobs in July as hiring momentum slowed after two months of record-shattering gains, according to data published Friday by the Bureau of Labor Statistics.

Net revisions for the previous two months were a positive 17,000, bringing the three-month average gain to 3.1 million through June. Still, the unprecedented job growth between May and July accounts for less than half of the 22 million jobs lost in March and April.

July's gain was larger than market expectations for a 1.5 million increase, but roughly a third of June's 4.8 million. New Covid-19 cases have surged in some parts of the country, prompting many states to pause or slow down their reopening plans and consumers to curtail trips outside of the home.

The unemployment rate fell to 10.2% in July from 11.1% in June, the BLS said. Errors in classifying laid off workers as employed have mostly be corrected, but the true rate of unemployment could be 1 percentage point higher than reported.


Total private payrolls rose by 1.46 million in July, led by gains in leisure and hospitality (+592,000), which accounted for a third of the total gain in payrolls. The vast majority of those jobs were in restaurants and bars. Other service industries including retail trade (+258,300) and education and health services (+215,000) also saw high volumes of hiring.

Government payrolls also grew markedly in July, rising by 301,000 as educators return to work after increasing by only 54,000 in June. Hiring for the 2020 Census also contributed 27,000 to the figure, the BLS said.

The labor force participation rate slipped to 61.4% from 61.5% in June, while the employment-to-population ratio rose to 55.1% from 54.6%. The U-6 rate, which accounts for discouraged workers, fell to 16.5% from 18.0% in June. The number of permanent job losers through July was virtually unchanged from the previous month at 2.9 million.
The length of the average work week fell by one-tenth to 34.5 hours from 34.6 hours in June, though the manufacturing work week rose 0.7 hour to 39.7 hours.
Average hourly earnings increased by 0.2% in July following a 1.2% in decline in June, but the BLS cautioned that any analysis of wage trends is complicated by large fluctuations in the number of low-paid workers during the pandemic. From a year earlier, earnings were up 4.8%.
MNI Washington Bureau | +1 202-371-2121 |
MNI Washington Bureau | +1 202-371-2121 |

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