Unemployment Rate Hits New Record Low Since Start of Pandemic
JOBS GROWTH:
Following strong numbers in the previous two months, the pace of jobs growth slowed in August. The economy produced 235,000 new jobs, which represented a significant slowdown from the 1.1 million new jobs created in July and 962,000 in June. Average monthly growth, year to date in 2021, has been 586,000.
TOP INDUSTRIES:
The sectors reporting the highest activity in August were professional and business services, transportation and warehousing, private education, manufacturing and other services. Losses were reported in the retail sector.
UNEMPLOYMENT:
The unemployment rate improved again, changing from 5.4% to 5.2%.
WAGES:
Average hourly wages rose by 17 cents in August, marking the fourth month of earnings increases.
WORK WEEK:
For the third consecutive month, the average work week remained steady at 34.7 hours.
TEMPORARY JOB TRENDS:
Positive trends took a U-turn in the temporary help sector as employment decreased by 5,800.
WHAT DOES IT ALL MEAN?
Normally vacation-heavy August has traditionally been an outlier in terms of hiring trends in the country. With job creation numbers significantly missing expectations, this August was no exception. The lower-than-anticipated numbers may answer last month’s question about the potential impact of the Delta variant. It appears that resurging health issues have slowed forward momentum in the jobs market.
Despite a disappointing month, the recovery continues, albeit at a slower pace. Hiring activity may very well intensify as we move into the fourth quarter. With the number of open jobs in America ticking up again, reaching 10.5 million, what hasn’t changed significantly is the ongoing challenge for employers to fill critically needed skills gaps.