August 6, 2021 – Employment rose by 943,000 in July as the U.S. unemployment rate now stands at 5.4 percent, according to the most recent U.S. Bureau of Labor Statistics report released this morning. The number of unemployed persons fell by 782,000 to 8.7 million. Notable job gains occurred in leisure and hospitality, in local government education, and in professional and business services.
Among the major worker groups, the unemployment rates declined in July for adult men (5.4 percent), adult women (5.0 percent), Whites (4.8 percent), blacks (8.2 percent) and Hispanics (6.6 percent). The jobless rates for teenagers (9.6 percent) and Asians (5.3 percent) showed little change over the month.
The number of long-term unemployed (those jobless for 27 weeks or more) decreased by 560,000 in July to 3.4 million but is 2.3 million higher than in February 2020. These long-term unemployed accounted for 39.3 percent of the total unemployed in July. The number of persons jobless less than 5 weeks increased by 276,000 to 2.3 million.
“While we’re continuing to see an improvement in our nation’s labor market, the ongoing labor shortage coupled with concerns about the Delta variant continues to be an issue for many businesses looking to fill open positions,” said Michael Smith, global CEO of Randstad Sourceright. “With federal unemployment benefits set to expire next month, employers should embrace flexibility to entice unemployed individuals back into the labor force. This may include improving compensation, offering flexible hours and work-from-home options, and leveraging a total talent management strategy that utilizes contingent workers to fill short-term employment gaps. Not only does this approach create a robust talent pipeline that provides flexibility to the business, but it also helps build relationships with temporary workers who could be transitioned to permanent roles as needed.”
Where Job Growth Occurred
- In July, employment in leisure and hospitality increased by 380,000. Two-thirds of the job gain was in food services and drinking places (+253,000). Employment also continued to increase in accommodation (+74,000) and in arts, entertainment and recreation (+53,000). Despite recent growth, employment in leisure and hospitality is down by 1.7 million, or 10.3 percent, from its level in February 2020.
- In July, employment rose by 221,000 in local government education and by 40,000 in private education. Staffing fluctuations in education due to the pandemic have distorted the normal seasonal buildup and layoff patterns, likely contributing to the job gains in July. Without the typical seasonal employment increases earlier, there were fewer layoffs at the end of the school year, resulting in job gains after seasonal adjustment. These variations make it more challenging to discern the current employment trends in these education industries. Since February 2020, employment is down by 205,000 in local government education and 207,000 in private education.
- Employment in professional and business services rose by 60,000 in July. Within the industry, employment in the professional and technical services component rose by 43,000 over the month and is 121,000 above its February 2020 level. (Professional and technical services includes industries such as accounting and bookkeeping services, management and technical consulting services, and scientific research and development services.) By contrast, employment in the administrative and waste services component (which includes temporary help services) changed little over the month (+20,000) and is 577,000 lower than in February 2020. Employment in the management of companies and enterprises component was also little changed over the month (-3,000) but is 100,000 lower than the level in February 2020. Employment in professional and business services overall is down by 556,000 since February 2020.
- Transportation and warehousing added 50,000 jobs in July. Job growth occurred in transit and ground passenger transportation (+19,000), warehousing and storage (+11,000), and couriers and messengers (+8,000). Employment in transportation and warehousing has grown by 534,000 since April 2020; the industry has recovered 92.9 percent of the jobs lost during the February-April 2020 recession (-575,000).
- The other services industry added 39,000 jobs in July, with gains in membership associations and organizations (+17,000) and in personal and laundry services (+15,000). Employment in other services is 236,000 lower than in February 2020.
- Healthcare added 37,000 jobs in July. Job gains in ambulatory health care services (+32,000) and hospitals (+18,000) more than offset a loss of 13,000 jobs in nursing and residential care facilities. Healthcare employment is down by 502,000 since February 2020.
- Employment in manufacturing increased by 27,000 in July, largely in durable goods manufacturing. Within durable goods, job gains occurred in machinery (+7,000) and miscellaneous durable goods manufacturing (+6,000). Manufacturing employment is 433,000 below its February 2020 level.
- Employment in information increased by 24,000 over the month, with three-quarters of the gain in motion picture and sound recording industries (+18,000). Employment in information is down by 172,000 since February 2020.
- Employment in financial activities rose by 22,000 over the month, largely in real estate and rental and leasing (+18,000). Employment in financial activities is down by 48,000 since February 2020.
- Employment in mining increased by 7,000 in July, reflecting a gain in support activities for mining (+6,000). Mining employment has risen by 49,000 since a trough in August 2020 but is 103,000 below a peak in January 2019.
- Employment in retail trade changed little in July (-6,000), following large increases in the prior two months. In July, job gains in gasoline stations (+14,000), miscellaneous store retailers (+7,000), and non-store retailers (+5,000) were more than offset by a loss in building material and garden supply stores (-34,000). Since February 2020, employment in retail trade is down by 270,000.
- In July, employment showed little change in construction and wholesale trade.
Talent Expert Weight In
Frank Scarpelli is managing partner and CEO of executive search firm HireWerx. He has dedicated his career to building and scaling companies through strategic business initiatives focusing on strategy, people, process and technology. With a strong understanding of technology and business, Mr. Scarpelli leverages in-depth knowledge of skills, behaviors, competencies and effective leadership characteristics to build high-performing teams and recruit top executives.
He recently sat down with Hunt Scanlon Media to discuss the pandemic, hiring and how his firm has adjusted to working with clients and candidates during the post-pandemic era. Following are excerpts from that discussion.
Frank, many are optimistic about a return to normalcy by the end of the summer. What are your thoughts about the recovery?
I have some doubts about a full return to normalcy by the end of summer given the trajectory of the COVID Delta variant. While I don’t foresee any major lockdowns, people will continue to want to work remotely. I believe that the hybrid model is here to stay.
What expectations do you have for the search industry for the rest of the year ahead?
There is a demand for talent like I haven’t seen in over 20 years since the dot-com boom. Our focus is on technology, so my perspective is influenced by our industry specialization. I don’t see any slowdown in demand for the search industry on any level. I see it trending upwards. What’s more, the fact that companies are hiring at the management and executive level remotely is really changing the game.
“There is a demand for talent like I haven’t seen in over 20 years since the dot-com boom.”
What sectors are strongest right now?
Many of our clients, including Fortune 500 CPG organizations were not negatively impacted over the past 18 months. In fact, they saw booming sales growth. Because the pandemic has boosted digital acceleration we are seeing rapid adoption of technology, which is what I believe is behind the productivity surge. We are seeing strong movement in the following sectors: medical technology, software and SaaS, IoT, as well as wireless technology, especially in the area of 5G.
Has your firm adjusted in terms of how it serves clients?
As a firm, we are always adjusting our services to accommodate our clients’ unique needs. I’d say the biggest change has been conducting virtually all of our meetings over video. It has increased the frequency of face-to-face communication tenfold. And more face time is always a good thing.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media