U.S. unemployment rate up slightly for July

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The slow economic recovery continued in July despite news that the unemployment rate rose to 6.2 percent from June’s rate of 6.1 percent, the federal Bureau of Labor Statistics reported Friday

The report held a hint of optimism because the unemployment rate grew as more people entered the workforce. The labor force was up by 329,000 people in July.

A survey of the population found that the number of people working in the nation grew by 131,000 while the number of people who were out of a job but looking for work also grew by 197,000.

Despite the optimism of job seekers, there were signs throughout the report, which is seasonally adjusted, that the economic recovery is still struggling.

In July, there were 9.7 million people who were unemployed. Before the Great Recession, the last time there were that many people who were out of work was 1992.

Jason Furman, chairman of the White House’s Council of Economic Advisors, noted that one-third of the unemployed, or 3.2 million people, have been out of work for more than six months.

There were also 7.5 million workers in July who were working part-time for economic reasons — 4.6 million because there wasn't enough work from their employer to work full-time.

The labor force participation rate rose slightly in July from 62.8 percent to 62.9 percent, after three months of hovering at the lowest level it has been since the 1970s.

Mr. Furman said a recent analysis of the labor force participation rate showed that baby boomer retirements account for about 1.7 of the 3 percentage points of decline in the labor force participation rate since 2007.

Stocks, which took a beating on Thursday, were down slightly on Friday in the all of the major indexes.

The Dow Jones Industrial Average closed at 16,493.37, down 69.93 points or 0.42 percent; the Standard & Poor’s 500 index was down 5.52 points or 0.29 percent to close at 1,925.15; and the Nasdaq closed at 4,352.64, down 17.13 points or 0.39 percent lower.

While employers added 209,000 jobs last month, hiring slowed in July.

Dean Baker, an economist with the Center for Economic and Policy Research in Washington, D.C. noted that employers had been creating about 277,000 jobs monthly over the prior three months.

Wage growth also slowed. Wages grew just 1.8 percent over the last three months when they had been up 2 percent over the last year.

“Overall, this should be seen as a modestly positive report,” Mr. Baker wrote in his analysis. “We are still far from the point where the labor market is strong enough that workers will be able to get wage gains in line with economic growth.”

Manufacturing grew by 30,000 jobs overall in July, with 19,200 jobs added building transportation equipment, 14,600 of those in the auto industry. Primary metals manufacturing added 1,700 jobs.

Scott Paul, president of the Alliance for American Manufacturing, pointed out that while the private sector now has the same number of jobs that it had before the Great Recession, manufacturing has only recovered a third of the jobs lost in the downturn.

Construction added 22,000 jobs in July with 6.100 jobs building homes. Another 2,500 jobs were added in heavy and civil engineering construction, which had fallen off by 600 jobs in June after a rainy month.

Large gains were seen in retail trade, which added 26,700 jobs. Health care added 7,000 jobs, with ambulatory care services up by 21,300 jobs. Hospitals and nursing homes lost about 14,000 jobs.

Governments added jobs in July, nearly all of them working for municipalities, which staff parks in the summer. Local governments, excluding the public schools, added 10,200 jobs in July. That may help explain why the number of teenagers who were working in July rose by 44,000.

Ann Belser: abelser@post-gazette.com or 412-263-1699.


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