Welcome to our monthly video series on the jobs reports featuring our Director of Customer Success Rebecca Warren (filling in for Chief Economist Sania Khan) and Senior Director, Product Marketing, Jason Cerrato. Every Friday morning after the reports are released, grab a cup of coffee and join them for the latest on the jobs numbers.
In the latest Bureau of Labor Statistics (BLS) employment report for June, jobs added came in a bit lower than expected, but other metrics tell a more positive, or at least steadier, story about the U.S. economy. Between the jobs report and the Job Openings and Labor Turnover Survey (JOLTS), released on Thursday, current labor statistics are a mixed bag that don’t give a crystal-clear picture of where we’re headed or what upcoming moves the Fed will make on interest rates.
According to the jobs report, the U.S. economy added 209,000 jobs, marking the 30th consecutive month of job expansion. However, the number falls short of the 230,000 prediction, and it’s the lowest monthly gain since the decline in December 2020.
On the other hand, according to the household survey portion of the report, hourly earnings grew by 0.4% month-over-month, and 4.4% year-over year; the unemployment rate dropped from 3.7% to 3.6%, and labor force participation held at 62.6%. The average workweek for all employees on private nonfarm payrolls ticked up by 0.1 hours to 34.4 hours in June. We should note, though, that 4.2 million people were employed part-time for economic reasons, meaning they would prefer full-time employment but couldn’t find it or had hours cut — that’s an increase of 452,000 from May.
“There’s always something positive followed by something negative followed by something positive followed by something a little negative, and we’re always trying to make sense of this,” Jason Cerrato said about the recent prevalence of mixed employment data. He also noted that this aligns with an ambivalent environment around remote versus in-office work on the part of both employers and workers.
“I think there’s this push and pull, positive and negative all at the same time of this return to the office strategy,” Cerrato said. “There are benefits for culture and benefits for alignment and benefits for engagement in person. But there are also things with remote work that we’ve benefited from around availability of talent, expanding opportunities, and being able to have work-life balance. So across the board it’s a very exciting and challenging time in HR.”
The JOLTS report for May showed a cooling in job listings, down to 9.8 million from 10.3 million from April. However, layoffs are unchanged from April, holding at 1%, indicating that while employers are hiring less, they are holding on to workers.
Rebecca Warren said this is consistent with what she’s hearing in her conversations with Eightfold customers. “Overall, it feels like there’s a slowdown in voluntary quitting. Before, we saw lots of folks who were moving all around the country and jumping around — we’re seeing less of that now, folks are staying put a little bit more. And so we’re seeing a lot of our customers invest less in talent acquisition and focus on talent management, looking at talent planning, succession planning, how do we keep the folks inside the organization and help them be successful?”
Here are some key takeaways from the reports:
- Employment in the government increased by 60,000 in June; overall, the government has added an average of 63,000 jobs per month so far in 2023, more than twice the average of 23,000 per month in 2022.
- Health care added 41,000 jobs in June, close to the 2023 monthly average of 42,000 so far, but dentist offices lost 7,000 jobs.
- Employment in construction continued to trend up in June (+23,000). Employment in the industry has increased by an average of 15,000 per month thus far this year, compared with an average of 22,000 per month in 2022.
- Job growth in professional and business services, leisure and hospitality, retail trade, and transportation and warehousing changed very little.
- The May Job Openings and Labor Turnover Survey (JOLTS) report revealed the number and rate of quits increased to 4 million (+250,000) and 2.6 percent, respectively. Despite this uptick, quits are lower than they were during last year’s “great resignation.”