Another weak jobs report came in at the low edge of expectations for June, according to the Bureau of Labor Statistics. The economy added 80,000 jobs, and the unemployment rate remains unchanged at 8.2%.
Because of some marginally better reports this week, including a strong private payroll report from Automatic Data Processing, expectations increased a bit. But as it turns out, BLS shows that the country remains at stall speed on jobs, not creating enough to keep up with population growth. The revisions for April and May were negligible. So this is the third straight month with payroll growth under 100,000, with average growth of 75,000 a month (down from 226,000 a month in the first quarter of 2012). The labor force participation rate and the employment-population ratio were unchanged in June, which is why we see basically no movement on the unemployment rate.
Election forecasters often say that these summer months are when opinions about the economy get locked in. So the attitude of the electorate, if that’s the case, would seem to be that the economy is in a very slow growth pattern.
The number of long-term unemployed over 27 weeks ticked down slightly to 5.37 million, but this still accounts for nearly 42% of the jobless. Those who find themselves unemployed starting this week will see no additional unemployment benefits after 27 weeks, if extended benefits are allowed to expire at the end of the year. If the trend holds, that means that over 5 million Americans will be out of benefits come Christmas, without Congressional action in the lame duck session.
State, local and federal governments lost 4,000 jobs in June, so the private payroll number was marginally higher at +84,000. Professional and business services led the way with 47,000 jobs gained, over half of those from increases in temporary help services. It’s often believed that strong temp growth is a prelude to larger job gains down the road. Manufacturing added a mere 11,000 jobs, and despite the heavy investment in a narrative of a housing recovery, construction added a negligible 2,000 jobs in June, and only then because of big gains among specialty trade contractors. Construction of buildings, both residential and non-residential, fell by 6,900 last month.
The average workweek increased by 0.1 hour, and average hourly earnings increased a decent 6 cents. Earnings have increased by 2% over the year.
Overall, another bad jobs report, with the economy generally stalled, and policymakers doing little to ameliorate the situation. “Where is the Federal Reserve” would be a good question right about now.