#161 – Inside Our Industry – Latest Jobs and Productivity ReportPosted on
Latest Jobs and Productivity Report
Last Friday, the Labor Department released the monthly jobs report. The economy added 187,000 jobs in July. The report also showed that most people who want to work can find jobs, keeping upward pressure on wages. Average hourly earnings rose 4.4 percent from a year earlier, slightly more than expected, and still faster than monetary policymakers would like.
A New York Times post stated, “The U.S. economy continued to produce sturdy employment growth in July but showed definite signs of cooling alongside the Federal Reserve’s battle to suppress inflation. The unemployment rate sank back to 3.5 percent, near a record low.”
In addition to the jobs information, labor productivity for the second quarter of 2023 was released. Labor productivity, or output per hour, for the manufacturing sector increased 4.0 percent over the first quarter 2023 level, as output increased 1.9 percent and hours worked decreased 2.0 percent. Overall, labor productivity improved by 3.7 percent in the second quarter, but remains low by historical standards.
“That might be because employers are hoarding workers as they try to refill head counts lost during the pandemic. Layoffs in July were the lowest since December 2022,” states Santul Nerkar with The New York Times.
Overall, the jobs report is positive news for the economy.
“Inflation has finally begun to moderate in earnest, even as economic growth has remained positive and the labor market has continued to chug along. But instead of interpreting that solid momentum as a sign that conditions are too hot, top economists are increasingly seeing it as evidence that America’s economy is resilient. It is capable of making it through rapidly changing conditions and higher Fed interest rates, allowing inflation to cool gradually without inflicting widespread job losses,” writes Jeanna Smialek and Ben Casselman with The New York Times.