The gain in payrolls last month followed a 231,000 advance in June that was bigger than previously estimated, a Labor Department report showed Friday in Washington, D.C. While the data also showed a pickup in hours worked, average hourly earnings climbed a less-than-forecast 2.1 percent from a year earlier, indicating little momentum in wage growth. The unemployment rate held steady at 5.3 percent. In Arkansas, Illinois, Maryland, Pennsylvania, and South Carolina, the unemployment gap is more than two and a half times as large as the rate for white Americans.
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Rising home sales helped boost construction jobs by 6,000. The U6 unemployment rate has not been below 10 percent since May 2008, when it was reported at 9.7 percent. And the number of people no longer in the workforce increased by 144,000.
The labor force participation rate was unchanged at 62.6 percent, the lowest level since 1977.
At the same time, jobless claims are hovering near the lowest level in four decades, as it becomes harder for employers to replace those let go.
According to the EPI, the employment-population ratio for people aged 25-54 was only 77.1 percent in July. This year that figure is 178,000 – a sign that job growth in isn’t as stellar. The economy has added 1.4 million jobs to date this year.
Average hourly earnings of private-sector workers rose 5 cents, or 0.2 per cent, last month to $US24.99.
Among the major worker groups, the unemployment rate for teenagers declined to 16.2 percent in July. Tokyo’s Nikkei 225 rose 0.3 percent. Economists had expected wages would rise slightly, 0.2% in July from June.
Still, the rise in wages would support views that a sharp slowdown in compensation growth in the second quarter and in consumer spending in June were temporary. Manufacturers added 15,000 jobs, with food, plastics and rubber factories accounting for most of the gain. The business services sector – which embraces everything from lawyers to accountants to engineers – added 40,000 workers, even though the number of temporary employees on short-term contracts fell 8,900.
Smoke added, “As the market focuses its attention on higher rates, which will negatively impact affordability, we’re nonetheless likely to see an increase in demand for homes in the slower fall and winter months because more jobs and higher wages will have more of an effect on housing in the short- to medium-term”. Although the report was slightly below analysts’ expectations, it spooked investors anxious by the prospect of the Federal Reserve beginning to turn down the spigot of virtually free money.
In the financial markets, stocks fell. At one point, the Down Jones Industrial Average was down by more than 135 points, before closing the day down by 46 points, the seventh day in a row the index had fallen.
Wall Street opened lower on the news and slid throughout Friday morning.
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Some of those misgivings were on display Thursday night at the first Republican presidential debate, where the candidates talked of simplifying the tax code, slashing regulations and easing the pressures on American workers resulting from immigration and global trade.
