Unemployment Rate Climbs to 4.3 Percent
August 2, 2024 – Employment rose by 114,000 in July as the U.S. unemployment rate rose to 4.3 percent, according to the most recent U.S. Bureau of Labor Statistics report. The number of unemployed persons was 7.2 million in July. Employment continued to trend up in healthcare, in construction, and in transportation and warehousing, while information lost jobs.
Among the major worker groups, the unemployment rates for adult men (4.0 percent) and whites (3.8 percent) increased in July. The jobless rates for adult women (3.8 percent), teenagers (12.4 percent), Blacks (6.3 percent), Asians (3.7 percent), and Hispanics (5.3 percent) showed little or no change over the month. Among the unemployed, the number of people on temporary layoff increased by 249,000 to 1.1 million in July. The number of permanent job losers changed little at 1.7 million. The number of long-term unemployed (those jobless for 27 weeks or more) changed little at 1.5 million in July. This measure is up from 1.2 million a year earlier. The long-term unemployed accounted for 21.6 percent of all unemployed people in July.
The labor force participation rate, at 62.7 percent, changed little in July and was little changed over the year. The employment-population ratio was little changed at 60.0 percent in July but is down by 0.4 percentage point over the year. The number of people employed part time for economic reasons rose by 346,000 to 4.6 million in July. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs. The number of people not in the labor force who currently want a job increased by 366,000 to 5.6 million in July, largely offsetting a decline in the previous month. These individuals were not counted as unemployed because they were not actively looking for work during the four weeks preceding the survey or were unavailable to take a job.
Among those not in the labor force who wanted a job, the number of people marginally attached to the labor force, at 1.6 million, was little changed in July. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, also changed little at 405,000 in July.
Where Job Growth Occurred
• Healthcare added 55,000 jobs in July, similar to the average monthly gain of 63,000 over the prior 12 months. In July, employment rose in home healthcare services (+22,000), hospitals (+20,000), and nursing and residential care facilities (+9,000).
• Employment continued to trend up in construction in July (+25,000), in line with the average monthly gain over the prior 12 months (+19,000). Employment in specialty trade contractors continued its upward trend in July (+19,000).
• In July, employment continued to trend up in transportation and warehousing (+14,000), with job gains in couriers and messengers (+11,000) and warehousing and storage (+11,000). These gains were partially offset by a job loss in transit and ground passenger transportation (-11,000). Transportation and warehousing has added 119,000 jobs since a recent low in January of this year.
• Employment in social assistance continued its upward trend in July (+9,000), but at a slower pace than the average monthly gain over the prior 12 months (+23,000).
• Information employment declined by 20,000 in July but has changed little over the year. Government employment was little changed in July (+17,000).
• Employment growth in government has slowed in recent months, following larger job gains in 2023 and the first quarter of 2024.
• Employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; manufacturing; wholesale trade; retail trade; financial activities; professional and business services; leisure and hospitality; and other services.
“Temperatures might be hot around the country, but there’s no summer heatwave for the job market,” said Becky Frankiewicz, president of the ManpowerGroup employment agency. “With across-the-board cooling, we have lost most of the gains we saw from the first quarter of the year.”
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“The latest snapshot of the labor market is consistent with a slowdown, not necessarily a recession,” said Jeffrey Roach, chief economist at LPL Financial. “However, early warning signs suggest further weakness.”
“While the labor market has remained remarkably resilient over these past two years of elevated interest rates, it’s important for the Federal Reserve to stay ahead of any further labor market slowing by proceeding with its expected September rate cut,” said Clark Bellin, chief investment officer at Bellwether Wealth.
Related: The Importance of Setting Proper Diversity Targets
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Executive Editor – Hunt Scanlon Media
