July Employment Data Almost All Positive – AJSN Says Latent Demand Unchanged at 16.4 Million Jobs Behind

According to two published new-positions projections, this morning’s Bureau of Labor Statistics data wasn’t supposed to do anything spectacular either way.  It didn’t, but its improvements were remarkably broad-based. 

We added 164,000 net new nonfarm positions, within a few thousand of the predictions.  The seasonally adjusted unemployment rate sat at 3.7% while the unadjusted one went up 0.2%, half or so of that due to typical differences between June and July, to 4.0%.  The adjusted jobless number gained 100,000 to 6.1 million.

From there, though, everything got better.  Those out for 27 weeks or longer lost a surprising one-sixth and is now at 1.2 million.  The count of those working part-time for economic reasons, or keeping short-hours positions while seeking longer ones, lost over 300,000 and is now at 4.0 million, 700,000 less than only three months ago.  The two measures of how common it is for Americans to be working, the labor force participation rate and the employment-population ratio, each gained a significant 0.1% and are now at 63.0% and 60.7% respectively.  Average private nonfarm payroll hourly earnings were up 8 cents, significantly over inflation, to reach $27.98. 

The American Job Shortage Number or AJSN, the measure of how many additional positions could be quickly absorbed if all knew they were available, was almost unchanged, as follows:

Increased latent demand from those officially unemployed, pushing the AJSN up 156,000, was more than offset by drops in almost every category of marginal attachment, most importantly those wanting to work but not looking for it over the past year and those claiming discouragement, down 154,000 and 144,000.  Between higher unemployment and lower inputs elsewhere, the share of the AJSN from official joblessness is now 36.0%, up 1.5% from June.  Compared with a year before the AJSN has improved 400,000, with the largest falls in official unemployment and the two marginal attachment groups just mentioned.

Overall, how good was July?  I am happier with the smaller groupings’ improvements than I am unhappy with higher unemployment.  We need those pools to continue to improve, as they remain underpublicized and are all too capable of harboring people who would rather be on the job.  Gains in the employment-population ratio and the labor force participation rate indicate a stronger than appearing economy, and we got both this time.  The AJSN did not get in on the act, but is still maintaining a good distance from what it was 12 months ago.  No records were set this time, but none were supposed to – the turtle took another step forward.