July Employment Data: AJSN Down 100,000-Plus to 16.8 Million Latent Demand as Jobs Situation Improves Slightly

Not much happened with this morning’s Bureau of Labor Statistics Employment Situation Summary, and not much was supposed to.

We gained 157,000 net new nonfarm payroll positions, less than one 190,000 estimate but still in the more-than-population-growth-can-absorb-but-undistinguished category.  The headline unemployment rate, also seasonally adjusted, dropped 0.1% to 3.9%, and other numbers mostly improved.  Total joblessness fell 300,000 to 6.3 million, the count of those working part-time for economic reasons or wanting full-time hours without finding them shed 100,000 to 1.4 million, and hourly nonfarm payroll earnings came in at a tad above inflation, gaining 7 cents per hour to reach $27.05.  Unadjusted unemployment also improved 0.1%, to 4.1%.  The two metrics best showing how common it is for Americans to have jobs, the labor force participation rate and the employment-population ratio, broke even at 62.9% and gained 0.1% to 60.5% respectively. 

The American Job Shortage Number or AJSN, the Royal Flush Press statistic showing in one figure how many more positions could be absorbed if all new that getting one would be easy, lost 131,000 from June, as follows:

About half of the AJSN’s monthly improvement was from the number of officially unemployed, down 82,000.  The rest came from lower counts of those not looking for a year or more and those in school or training, offset mostly by more people reporting as discouraged.  Latent demand from those officially jobless now accounts for 36.1% of the total, down 0.1% from last month.

Compared with a year before, the AJSN looks much better, down 845,000 from July 2017.  Three-fourths of that was from lower official unemployment, with a surprising 139,000 from fewer people in the armed services, in institutions, or off the grid.  Word of more work opportunities does reach these segments.

So how good was July’s data?  I give it a thumbs up.  It’s not a massive gainer, but with so many numbers improving, more net new positions than our growing populace itself needs, and continued strong year-over-year AJSN improvements, it was on the right side.  The turtle is still a turtle, but he did take another small step forward.