The headline jobs number in the July employment report was slightly below expectations, however, employment for the previous two months was revised down by 49,000, combined. The participation rate was unchanged, and the employment population ratio increased slightly, and the unemployment rate decreased to 3.5%.
In July, the year-over-year employment change was 3.36 million jobs.
Prime (25 to 54 Years Old) Participation
Since the overall participation rate is impacted by both cyclical (recession) and demographic (aging population, younger people staying in school) reasons, here is the employment-population ratio for the key working age group: 25 to 54 years old.
The 25 to 54 participation rate decreased in July to 83.4% from 83.5% in June, and the 25 to 54 employment population ratio was unchanged at 80.9% from 80.9% the previous month.
Average Hourly Wages
Wage growth has trended down after peaking at 5.9% YoY in March 2022 and was at 4.4% YoY in July.
From the BLS report:
“The number of persons employed part time for economic reasons, at 4.0 million, changed
little in July. These individuals, who would have preferred full-time employment, were
working part time because their hours had been reduced or they were unable to find
The number of persons working part time for economic reasons decreased in July to 4.00 million from 4.19 million in June. This is below pre-recession levels.
These workers are included in the alternate measure of labor underutilization (U-6) that decreased to 6.7% from 6.9% in the previous month. This is down from the record high in April 22.9% and up from the lowest level on record (seasonally adjusted) in December 2022 (6.5%). (This series started in 1994). This measure is below the 7.0% level in February 2020 (pre-pandemic).
Unemployed over 26 Weeks
According to the BLS, there are 1.164 million workers who have been unemployed for more than 26 weeks and still want a job, down from 1.105 million the previous month.
This is at pre-pandemic levels.
The headline monthly jobs number was slightly below consensus expectations; however, May and June payrolls were revised down by 49,000 combined.