Three Troubling Signs in Latest Jobs Report
The Bureau of Labor Statistics (BLS) today released their jobs report for June, showing that the unemployment rate stayed unchanged at 3.6 percent, with the economy adding just 209,000 jobs last month.
The data shows that the “labor market cooled” in June, according to CNN. Under the surface, there are three other troubling signs in this report.
Part-Time Workers Increased Sharply.
BLS said that the “number of persons employed part time for economic reasons increased by 452,000 to 4.2 million in June, partially reflecting an increase in the number of persons whose hours were cut due to slack work or business conditions.”
- Why is this a big deal? People often take on part-time jobs when they are either struggling to find full-time work or are forced to when their full-time positions have hours reduced or are cut due to slowing economic conditions. Workers and businesses are still feeling the sting of Bidenflation and the slowing Biden economy—and they are having to take on second part-time jobs or work more hours to make up for higher costs on everyday goods and a weakening labor market.
Substantial Downward Revisions on Previous Months’ Reports.
There were substantial downward revisions over the past two months for topline job growth. According to BLS: “The change in total nonfarm payroll employment for April was revised down by 77,000” while “the change for May was revised down by 33,000.”
- Why is this a big deal? It is common for previous reports to be revised at a later date as more data comes in—but in a stronger labor market, we would want to see revisions show at least no change if not stronger than reported job growth, not weaker. Per BLS: “employment in April and May combined is 110,000 lower than previously reported.”
Overall Job Growth is Cooling.
BLS finds that average monthly employment growth has slowed markedly since last year, stating “nonfarm employment has grown by an average of 278,000 per month over the first 6 months of 2023, lower than the average of 399,000 per month in 2022.”
- Why is this a big deal? The economic recovery from the pandemic has been slow, and this report shows that the gains that have been made in the jobs space are cooling. This adds salt to the wound when considering CBO’s latest long-term outlook, which projects that the debt is set to grow to historically high levels while the country sustains its slowest extended period of economic growth ever. The Federal Reserve has also seen cooling job growth.
There are other areas of concern in this report, as reported by the Wall Street Journal.
“Job openings fell in May. Initial applications for unemployment benefits, a proxy for layoffs, rose last week and are up about 20% from the start of the year. And the average number of hours worked a week declined this year, which in the past often preceded job cuts.
“The labor-force participation rate, or the share of Americans who are working or actively seeking jobs, remains well below the February 2020 pre-pandemic level of 63.3%...”
The Bottom Line: The reckless spending and failed economic policies that has led to Bidenflation continues to impact every corner of our economy—including job growth. House Republicans will continue our work to rein-in the President’s harmful and costly economic agenda.