Unemployment Rate Drops Slightly to 9.4%
The USA unemployment rate dropped slightly to 9.4%. The economy lost 247,000 jobs which is both a sign the economy is not strong and also that it is improving (job losses from November through April were 645,000/month and 331,000/month from May through July). The job losses for May and June were both revised to show 20,000 fewer job losses each in the press release from the Bureau of Labor Statistics.
The number of long-term unemployed (those jobless for 27 weeks or more) rose by 584,000 over the month to 5.0 million. In July, 1 in 3 unemployed persons were jobless for 27 weeks or more.
The employment-population ratio, at 59.4%, was little changed over the month but has declined by 330 basis points since the recession began in December 2007. About 2.3 million persons were marginally attached to the labor force in July, 709,000 more than a year earlier (The data are not seasonally adjusted). These individuals, who were not in the labor force, wanted and were available for work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.
In July, the average workweek of production and nonsupervisory workers on private nonfarm payrolls edged up by 0.1 hour to 33.1 hours. The manufacturing workweek increased by 0.3 hour to 39.8 hours. Factory overtime was unchanged at 2.9 hours.
This news supports the increasing livelihood of a weak recovery taking hold during 2009 – which is frankly pretty amazing in my opinion. The economy could certainly have taken longer to recover. Still, more job losses and an increasing unemployment rate are likely before the end of 2009.
Related: Another 450,000 Jobs Lost in June – USA Unemployment Rate Jumps to 9.4% (May 2009) – USA Unemployment Rate Rises to 8.1%, Highest Level Since 1983 (March 2009)
Among the marginally workforce, there were 796,000 discouraged workers in July, up by 335,000 over the past 12 months (The data are not seasonally adjusted). Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The other 1.5 million persons marginally attached to the labor force in July had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities.
Employment in construction declined by 76,000 in July, about in line with the average for the past 3 months. Manufacturing employment fell by 52,000 in July and has declined by 2.0 million since the recession began. In motor vehicles and parts, fewer workers than usual were laid off in July for seasonal retool-
ing. As a result, the estimate of employment for the industry rose by 28,000 after seasonal adjustment. In large part, July’s seasonally-adjusted increase reflects the fact that previous job cuts had been so extensive that there were fewer workers to lay off during the seasonal shutdown. Elsewhere in manufacturing, several industries continued to lose jobs in July, including machinery (-15,000) and fabricated metal products (-14,000).
Employment in professional and business services continued to trend down in July (-38,000); the industry has shed 1.5 million jobs since the start of the recession. Within professional and business services, employment in the temporary help industry edged down in July. While temporary help has lost 844,000 jobs since the recession began, the declines have lessened substantially over the past 3 months.
Transportation and warehousing lost 22,000 jobs in July. Since May, the average monthly job loss was half the average monthly decline for November through April (-17,000 versus -34,000).
Financial activities employment continued to trend down in July (-13,000). The average monthly decline for this industry was 23,000 over the past 3 months compared with 46,000 per month from November through April. Since the start of the recession, the financial activities industry has lost 501,000 jobs. Employment in information declined by 16,000 in July, including losses in publishing and telecommunications.
Health care employment increased by 20,000 in July, about in line with the average monthly gain for the first half of this year but down from an average monthly increase of 30,000 during 2008. Employment in lei-sure and hospitality has been little changed over the past 3 months.