June’s Employment Report: With Big Hiring, Looks Like No Recession, but AJSN, Up to 16.4 Million, Says Latent Job Demand is Still a Problem

As May’s job growth lagged, this morning’s Bureau of Labor Statistics Employment Situation Summary was especially important.  A subpar gain in the number of Americans working, when results insufficient to cover population growth have long been rare, would mean two in a row.  But we didn’t get that.  We exceeded the published projections of 160,000 and 168,000 to add 224,000 net new nonfarm positions, putting us back on the beam.

Other numbers were mixed.  The adjusted unemployment rate edged up 0.1% to 3.7%, with the unadjusted figure seasonally way up, gaining 0.4% to 3.8%.  There are now 6.0 million adjusted jobless, up 100,000, including 1.4 million out for 27 weeks or longer which grew the same amount.  The count of those working part-time for economic reasons, or holding on to less than full-time positions while unsuccessfully seeking longer-hours ones, fell 100,000 to 4.3 million, an especially strong result following last month’s 300,000 decline.  The two measures of how common it is for Americans to be working, the labor force participation rate and the employment-population ratio, gained 0.1% and broke even, and are now at 62.8% and 60.6% respectively.  The average private nonfarm payroll wage matched last month’s slightly-above-inflation 9 cents per hour increase, and is now at $27.83.

The American Job Shortage Number or AJSN, the metric showing how many additional positions could be quickly filled if all knew that getting one was easy and routine, gained 800,000, as follows:

The AJSN’s increase, mostly due to the difference between May and June (it is not seasonally adjusted), came mostly from official unemployment, but was pushed along by more people reporting they wanted to work but did not look for it for a year or more.  The share of the AJSN from those technically jobless was 34.5%, up 2.8% from May’s record low and also a seasonal outcome.  Compared with June 2018, the AJSN is now half a million lower, almost completely from higher official unemployment. 

How did we do?  Clearly we’re about where we were a few months ago, with May’s poor net-new-jobs result now looking random or caused by temporary factors.  We’re still gaining positions, but more people are looking for them, with a 1.5 million drop in those claiming no work interest and more discouraged.  Once more, we can’t fail to notice that the categories of marginal attachment, the second through eighth rows on the chart above, have stopped improving.  Still, we have less to worry about than a month ago.  The turtle took a small step forward.