After half a year of job growth above 200,000 each month, the U.S. economy generated just 134,000 seasonally adjusted new private-sector jobs in August, along with 8,000 public-sector jobs. That total of 142,000
reported by the Bureau of Labor Statistics Friday was the lowest since December 2013. It was also more than 80,000 fewer than the consensus of experts had thought it would be.
The official unemployment rate, the one the BLS calls U3, fell to 6.1 percent. The bureau also presents several alternative measures of job growth or loss each month, the most important being U6. This includes not only people with no job at all but also those who are working part time and want (and need) full-time jobs and many "discouraged" workers. It thus covers the unemployed and underemployed, but does not cover those who have left the labor force whatever their reasons for doing so even if that is despair over not being able to find work. U6 fell to 12.2 percent in July to 12.0 percent in August.
The bureau revised the number of jobs originally reported in July from 209,000 to 212,000, and in June from 298,000 to 267,000.
By the bureau's count, there are now 610,000 more jobs than at the pre-recession peak.
The payroll services company Automatic Data Processing reported on Wednesday a gain in of August of a seasonally adjusted 204,000 private-sector jobs. ADP does not report on public-sector jobs. Its calculation and BLS's for the private-sector rarely mesh closely as it clearly did not for August.
The BLS offers a caveat that "the monthly change in total nonfarm employment from the establishment survey is on the order of plus or minus 90,000." In other words, the bureau's statisticians are 90 percent confident that the "real" number of new jobs created in August wasn't actually 142,000, but somewhere in a band between 232,000 and 52,000.
Both full-time and part-time jobs are included in the bureau's total. A woman who reports she was hired to work 15 hours a week in August is counted the same as someone hired to work 40 hours a week.
For more details about today's jobs report, please continue reading below the fold.
The bureau tallied 9.6 million people unemployed in August. This excludes the millions of workers who have left the workforce out of despair they will find a job.
The employment-population ratio remained steady at 59 percent for the third consecutive month. The labor force participation rate slipped back to 62.8 percent, a 36-year low. The civilian labor force decreased by 64,000.
Americans in the category of the long-term unemployed—jobless for 27 weeks or more—fell 192,000 to 3.0 million, 31.2 percent of the total unemployed.
Although hourly wages edged upward again, workers are barely keeping up with inflation, now running at about 1.9 percent a year.
What's more, as concluded by authors of a report published in April by National Employment Law Project, the majority of jobs gained since the summer of 2009 aren't as good as the ones that were lost:
• Lower-wage industries constituted 22 percent of recession losses, but 44 percent of recovery growth.
• Mid-wage industries constituted 37 percent of recession losses, but only 26 percent of recovery growth.
• Higher-wage industries constituted 41 percent of recession losses, and 30 percent of recovery growth.
Today, there are nearly two million fewer jobs in mid- and higher-wage industries than there were before the recession took hold, while there are 1.85 million more jobs in lower-wage industries.
Among other news in the August job report:
Demographic breakdown of official (U3) seasonally adjusted jobless rate:
• African American: 11.4 percent
• Latino: 7.5 percent
• Asian (not seasonally adjusted): 4.5 percent
• American Indian (data not collected on monthly basis)
• White: 5.3 percent
• Adult women (20 and older): 5.7 percent
• Adult Men (20 and older): 5.7 percent
• Teenagers (16-19): 19.6 percent
Duration of unemployment:
• Less than five weeks: 2.6 million
• 5 to 14 weeks: 2.44 million
• 15 to 26 weeks: 1.48 million
• 27 weeks and more: 2.96 million
Job gains and losses in selected categories:
• Professional services: + 47,000
• Transportation and warehousing : +1,200
• Leisure & hospitality: + 15,000
• Information: - 3,000
• Health care: + 42,700
• Retail trade: - 8,400
• Construction: + 20,000
• Manufacturing: + 0
Hours and wages
• Average work week for all employees on non-farm payrolls remained at 34.5 hours for the sixth month in a row.
• Average hourly earnings of private-sector production and nonsupervisory employees increased by 6 cents to $20.68.
• Average hourly earnings for all employees on private non-farm payrolls rose 6 cents to $24.53.
Here's what the seasonally adjusted job growth numbers have looked like in August for the previous 10 years.
August 2004: + 132,000
August 2005: + 196,000
August 2006: + 184,000
August 2007: - 16,000
August 2008: - 259,000
August 2009: - 216,000
August 2010: - 42,000
August 2011: + 122,000
August 2012: + 150,000
August 2013: + 202,000
August 2014: + 142,000
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The BLS jobs report is the product of a pair of surveys, one of more than 410,000 business establishments called Current Employment Statistics, and one called the Current Population Survey, which questions 60,000 householders each month. Here is the BLS's explanation of its methodology. The establishment survey determines how many new jobs were added. It is always calculated on a seasonally adjusted basis determined by a frequently tweaked formula. The BLS report only provides a snapshot of what's happening at a single point in time.
It's important to understand that the jobs-created-last-month-numbers that it reports are not "real." Not because of a conspiracy, but because statisticians apply formulas to the raw data, estimate the number of jobs created by the "birth" and "death" of businesses, and use other filters to fine-tune the numbers. And, always good to remember, in the fine print, they tell us, with a 90 percent confidence level, that the actual number of newly created jobs reported each falls within a plus or minus 90,000 range.