New Jobs Down, Unemployment Up, Other Factors Generally Worse Including AJSN Showing 17.8 Million Latent Demand

Did this morning’s Bureau of Labor Statistics Employment Situation Summary show tariffs, which have recently sunk in, affecting the job market?

The data showed that, for once, we gained fewer net new nonfarm payroll jobs than the published estimate I saw – instead of 115,000 it was 73,000.  Despite little seasonal difference, adjusted and unadjusted unemployment both worsened, 4.2% from 4.1% and 4.6% from 4.4%.  The seasonally adjusted jobless count rose 200,000 to 7.2 million, with those holding that status for 27 weeks or longer gaining the same amount to 1.8 million.  The two statistics showing how common it is for Americans to be working and officially unemployed, the labor force participation rate and the employment-population ratio, each dropped 0.1% to reach 62.2% and 59.6%.  Those working part-time for economic reasons, or keeping shorter-hours positions while looking unsuccessfully for longer-hours ones, jumped 200,000 for the second straight month, to 4.7 million.  Average private nonfarm payroll hourly wages were up 12 cents, slightly more than inflation, getting to $36.44.

The American Job Shortage Number or AJSN, the measure showing how many new positions could be quickly filled if all knew they would be easy and routine to get, gained over 300,000 to the following:

That increase was entirely explained by higher unemployment, with everything else, including a substantial fall in those discouraged and a sizable rise in the number of people wanting to work but not looking for it for a year or more, collectively almost breaking even.  The share of the AJSN from official joblessness was 39.6%, up 1.3%.  Compared with a year before, the AJSN was virtually unchanged at 30,000 lower, with a higher estimate of the number of American expatriates offset mostly by gains in the effect of those not looking for a year or more, unemployment, and not wanting jobs at all.

How did this month turn out?  Not well.  I’m unconcerned about gaining only 73,000 jobs – that’s about what our population can absorb, so it isn’t a loss.  It’s that unemployment and participation rates fell too much between the similar times of mid-June and mid-July.  Other results around the margins, such as on working part-time for economic reasons and still looking after half a year, point to a labor market worse than the front-line numbers show, not that those were impressive here either.  And yes, we must charge the tariffs for some of this poor showing.  On the good side, about 100,000 fewer stayed out of the labor force, and the odd situation with two marginal attachment categories seems to be over.  Yet if the latest tariff pronouncements materialize, we may well see similar worsenings in August.  In the meantime, I feel if anything charitable to declare that the turtle went nowhere.