There was a fair amount of concern over the August employment numbers released last week. The economy added 142K jobs which is a significant drop when compared to the rolling 12 month average of 212K. Furthermore, June and July numbers were revised down by another 28K.
Here are a few additional details in the data release:
- The long-term (27+ weeks) unemployed dropped by 192K down to 3M.
- Professional and Business Services added 47K jobs.
- Healthcare added 34K jobs.
- Food Services and Drinking Places added 22K jobs.
- Construction added 20K jobs.
- Manufacturing was largely unchanged.
- The Average Hourly and Weekly Earnings continued trending up.
While the headline doesn’t read well the details provide a more moderate report. It’s very good to see the reduction of the long-term unemployed and continued increases in average earnings. It’s also good to see the construction sector continue to add jobs for eight straight months. There is no question that we want to see more out of the manufacturing sector in the long-term. However these monthly results are not alarming considering how well June and July performed compared to 2013.
Considering where we’ve been – we should continue to feel positive about the direction of the economy. Anecdotally business owners feel very differently compared to two years ago or even just one year ago. Increased hiring is undoubtedly more widespread across industries and employers of various sizes. We still have our limitations but there continues to be a growing sense of stability and confidence by both business owners and consumers.