The Employment Situation for August 2022
Published On: August 8, 2022
Editor's Note: This report is based on survey data from July 2022 that was published in August 2022. This is the most recent data available. (Source: Bureau of Labor Statistics)
The U.S. added 528,000 jobs last month–a near 50% increase over the month before–doubling consensus economic forecasts and, in some cases, beating prominent predictions by a multiple of five. What's more, the unemployment rate finally broke through and dropped another tenth of a percentage point to 3.5%, officially registering the lowest unemployment rate in more than half a century.
Beyond the record-setting job market, the total number of unemployed persons in the U.S. (now at 5.7 million) and the unemployment rate are below pre-pandemic levels. Further, both the number of long-term unemployed (1.1 million) and those experiencing temporary layoffs (790k) have returned to pre-pandemic levels.
That said, the number of people in the labor pool who would like a job is at 5.9 million, which is above the February 2020 benchmark of 5 million. Although the number of people employed part-time is below February 2020 levels, this category did increase by more than 300,000 last month, highlighting that this exceptional economic report is not entirely without blemishes.
As for how these newly added jobs were allocated, the leisure and hospitality industry saw the largest gain with nearly 100,000 new jobs; nearly three-fourths of these jobs were hired at food and beverage establishments.
Business and professional services claimed almost 90,000 new jobs, with healthcare adding 70,000 jobs, and the government adding almost 60,000. Construction, manufacturing, and social assistance employers added about 30,000 jobs each last month, while about 20,000 jobs were added in both retail and transportation and warehousing.
Average hourly earnings rose by $0.15 (or half a percentage point) last month, growing by a little over 5% over the past year; meanwhile, the average work week was unchanged at 36.4 hours for the sixth consecutive month. The number of people working remotely also held steady at 7% after many months of decline.
Mployer Advisor’s Take:
To say that this job market is performing remarkably well would be an understatement in normal times, but it is truly something to see these figures given the lingering pandemic and supply chain impacts and inflation hitting a 40-year high while the Fed ratchets up interest rates in turn.
Although there are still fair reasons to be concerned about a looming economic downturn, most notably consecutive quarters of GDP contraction, fears of imminent recession are somewhat fading across reputable prognosticators.
In the short term, the job market will continue driving up wages and pumping money into the economy. Although this reality will not help inflation and will likely lead to further intervention from the Federal Reserve via additional interest rate hikes, it will work to bolster the economy against recession.
This balancing act between a hot job market, high inflation, and economic stability will become the primary focus of increasing attention in the coming months.
Director of Content, Mployer Advisor