The BLS job reports for last month were just released! We’ll share our take on the data and what it means for you and your company.
Relevant Data Points:
- New Jobs – The U.S. added 261,000 jobs, better than the projected growth of 205,000 (graph below)
- Even with the reduced pace, job growth has been well ahead of its pre-pandemic level (in 2019, monthly payroll growth averaged 164,000).
- The economy added an average of 183,000 jobs per month over the course of the decade before COVID.
- Unemployment rose to 3.7% (up from 3.5%).
- Wages rose 0.4%, exceeding the prior month’s gain of 0.3% (up 4.7% from one year ago) (graph below).
- Job openings totaled 10.72 million (up from 10.05 million), which is well above the estimate of 9.85 million (graph below).
- Hires dropped to just under 6.1 million (from 6.3 million), the lowest level since February 2021.
- Layoffs decreased to 1.3 million (down from 1.5 million).
- Quits dropped to 4.1 million (from 4.16 million).
- Total separations rapidly declined, falling by nearly 400,000 to a rate of 3.7%.
- Jobs per available worker increased to 1.9:1 (increase from 1.67:1).
- LFPR (labor force participation rate) continues to edge lower, dropping to 62.2% (from 62.3%); this is more than a percentage point lower than its pre-pandemic high.
What does this mean?
- This month’s report is a sign of how strong the U.S. job market remains despite the Fed’s attempts to weaken it.
- Although the jobs report was more than expected, it marked the slowest pace of job growth since December 2020.
- Even with another relatively strong labor/jobs report, key indicators show the labor/job market is cooling.
- Declining hires + increase in unemployment + decrease in quits = a cooling labor market.
- Wage growth continues to lag the Consumer Price Index.
- Layoffs continue to grab headlines, but the overall layoff rate is still quite low.