US Hiring Hits the Reset Button After July’s Job Loss
Synopsis
US job growth is forecast to recover in August after July’s payroll decline, while unemployment remains at 4.1%. Private-sector hiring rose 38,000, with sector results remaining mixed.
US employers will see the addition of 56,000 jobs to employment in August as job gains slow to a net reduction of 23,000 positions in July, economists say. The unemployment rate is likely to be 4.1% when the BLS publishes its Employment Situation report for August on September 4.
The forecast follows the July report of weaker hiring in some sectors and sizeable downward revisions to prior employment data.
July Revisions Put Hiring Under Pressure
Employment in the United States was rising average of just 34,000 jobs per month over the past 12 months. During the month, local government education employment lost 50,000 jobs and retail trade lost 19,000 jobs.
The health care sector continued to grow, but the number of jobs gained in July was 22,000, below its 12-month average of 36,000. Employment also rose 22,000 in construction and fell 14,000 in financial activities.
The BLS also revised May payroll growth down from 129,000 to 63,000 and June growth down from 57,000 to 20,000. Those two months saw employment increase by 83,000 jobs net of the revisions.
Private Hiring Shows Uneven Sector Trends
Mixed signals for the US employment market come from the private sector data. Private employers created 38,000 jobs in August, below the 48,000 jobs economists had expected, ADP reported.
Educational and health services gained the most jobs, with over 45,000 new positions, while leisure and hospitality had 16,000 jobs, construction had 12,000 jobs and financial activities had 6,000 jobs. Professional and business services lost 16,000 jobs, followed by a decrease of 17,000 jobs in manufacturing.
Activity was also strong in the services sector in August. The Institute for Supply Management services index was up to 55.4 from 54.1 while the employment index remained below the 50-point threshold at 47.8.
The nation's job gains are compared to the most recent data on labour markets in other economies. The unemployment rate in July was 4.5% in Australia and 2.4% in Japan (based on different national statistical systems and reference periods).
July's US data also showed that there were 7.3 million job openings, about 1.05 per unemployed person. Wages increased in an annual rate of 3.2% in July and are expected to rise by 3.0% a year in August.
Source: Reuters
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
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