The report on employment released today was not good news but it was less bad than feared. Total nonfarm payroll employment rose by 117,000 in July, and the unemployment rate was little changed at 9.1%, the United States Bureau of Labor Statistics reported today. Employment growth in July, follows little growth over the prior 2 months. Total private employment rose by 154,000 over the month. Sectors experiencing growth include: health care, retail trade, manufacturing, and mining. Government employment continued to trend down.
Some good news is found in the adjustments to the last two months job numbers. The change in total nonfarm payroll employment for May was revised from +25,000 to +53,000, and the change for June was revised from +18,000 to +46,000. That adds 56,000 jobs to the 117,000 jobs added in July and brings to the total for this report to 173,000 additional jobs. Still not great but much better than the last 2 months. The economy needs to add 125,000 a month to keep up with population growth.
And currently the economy needs to add much more to make up for all the jobs lost due to the too big to fail institution created credit crisis. The damage done to the economy by those institutions and continuing to be done in order to support those companies remains enormous. I believe we need to see 230,000 jobs added a month consistently (in order to be making ground up for the damage done), before we can believe we are doing well.
Remember it was just over 2 years ago we were losing hundreds of thousands of jobs a month. We are doing much better now, but fixing how broken things were is not easy. Between January of 2008 and February of 2010, the economy lost 8.75 million jobs. Since February 2010, 1.94 million jobs have been added. That means we have still lost 6,810,000 jobs and when you consider we have to add 125,000 a month to keep up we have 43 * 125,000 = 5,375,000 we haven’t added bringing a the total of jobs needed to over 12,000,000 (the number we need to add to get back to where we were). But truthfully we probably were at a bubble induced level at the peak so 12,000,000 is probably an overestimate of how many jobs we need to gain back.
Even if we aim for 6,000,000 more jobs than we have now (plus the 125,000 a month) if we add 225,000 a month it would take 5 more years to gain those 6,000,000 jobs (plus those 125,000 needed for working age population growth). Since February 2010 we should have added 2,125,000 to keep pace with the 125,000 jobs needed each month so we have actually fallen behind by an additional 185,000 jobs. Still getting out of the huge monthly declines caused by the irresponsible too big to fail institutions has been a huge effort and it is frankly amazing we have done this well.
The number of long-term unemployed (those jobless for 27 weeks and over), at 6.2 million, account for 44.4% of the unemployed (quite a high percentage historically). The civilian labor force participation rate edged down in July to 63.9%.
Health care employment grew by 31,000 in July. Over the past 12 months, health care employment has grown by 299,000. Retail trade added 26,000 jobs in July. Employment in retail trade has increased by 228,000 since a recent low in December 2009.
Manufacturing employment increased by 24,000 in July; nearly all of the increase was in durable goods manufacturing. Manufacturing has added 289,000 jobs since its most recent trough in December 2009, and durable goods manufacturing added 327,000 jobs during this period.
Employment in professional and technical services continued to trend up in July, adding 18,000 jobs. This industry has added 246,000 jobs since a recent low in March 2010. Employment in temporary help services changed little over the month and has shown little movement on net so far this year.
Government employment continued to trend down over the month; losing 37,000 jobs. Employment in state government decreased by 23,000, almost entirely due to a partial shutdown of the Minnesota state government. Employment in local government continued to wane over the month.
The average workweek for all employees on private nonfarm payrolls was unchanged over the month at 34.3 hours. The manufacturing workweek and factory overtime for all employees also were unchanged at 40.3 hours and 3.1 hours, respectively. In July, the average workweek for production and nonsupervisory employees on private nonfarm payrolls was 33.6 hours for the sixth consecutive month. Repeated monthly increases in work week often presage good job news going forward.
Trying to dig out of the huge whole created by the credit crisis in a enormous task that we are all continuing to suffer with, while those bailed out are living lavishly based on the handouts we gave (and continue to give) them.
Related: Job losses from November through April 2009 were 645,000/month and 331,000/month from May through July – USA Added 244,000 Jobs in April – USA Economy Lost 125,000 Jobs and Unemployment Rate Decreased to 9.5% (June 2010) – USA Added 192,000 Jobs in February