Arthur J. Villasanta – Fourth Estate Contributor
Washington, DC, United States (4E) – The United States’ July jobs report released Aug. 3 presented a mixed bag of both good and bad news, with the good news apparently outweighing the bad.
The jobs report issued by the Bureau of Labor Statistics revealed U.S. employers added 157,000 net jobs in July, which was a lower number than economists expected. It said these 157,000 jobs were fewer than the 190,000 increase estimated by economists.
The unemployment rate nationwide fell to 3.9 percent from four percent, approaching an 18-year low.
The bad news is that wage growth did rise but remained sluggish. The government said average hourly earnings rose by a miniscule 0.3 percent in July month-on-month, a negligible gain of 0.1 percentage point. Year-on-year growth wage growth was unchanged at 2.7 percent.
Leisure and hospitality, manufacturing and business services industries led job growth in July.
“The important point is that there is no sign of overheating but that aggregate wages and salaries (jobs x hours x earnings) are growing at a brisk pace,” said Neil Dutta, head of U.S. economics at Renaissance Macro Research, a research firm based in New York.
The professional and business services sector was the biggest net job gainer for July, adding 51,000 jobs. Of this total, more than half came from hiring in administrative and support services.
The manufacturing sector added 37,000 jobs, extended a strong streak of job growth which indicates that Trump’s trade war hasn’t negatively affected hiring decisions as of yet. Over the past year, manufacturers hired 327,000 people, the most since the 12 months through April 1995.
The construction sector added 19,000 jobs despite a slowdown in residential home construction due to ballooning home prices throughout the country. The retail sector recovered somewhat and gained 7,100 jobs in July after losing more than 21,000 jobs in June.
Leisure and hospitality job growth was also strong, and added 40,000 more jobs. This industry includes jobs in the performing arts, spectator sports, museums and food services.
On the other hand, job losses were particularly severe in sporting goods, hobby, book, and music retailers, which lost a net 31,800 jobs.
The government also reported fewer people filing for unemployment benefits for the first time. Initial jobless claims were near a 50-year low in the week of the BLS survey for the jobs report. Jobless claims are an early sign of mass layoffs in the labor market because many people apply for benefits soon after they lose their jobs.
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